AUTHOR: OKONKWO JISIKE J.
DEPARTMENT: BANKING & FINANCE
AFFILIATION: NNAMDI AZIKIWE UNIVERSITY, AWKA
This thesis reviews and appraises the relationship between exchange rate variation and Nigeria balance of trade between 1989– 2009. This study was necessitated by the fact that balance of trade is directly or indirectly affected by the direction of exchange rate in the country. The following are the objectives of the study. To evaluate the nature and extent of the relationship between exchange rate variation and analyze effects on balance of trade. To investigate the dynamic characteristics of the adjustment of trade exports and imports to price and foreign exchange fluctuation and also the effect of devaluation of naira on the country’s balance of trade. The literature review extends into works done under exchange rate changes and balance of trade. While the method of data collection was through secondary data. The data collected were regressed by simple regression model and analyzed by ordinary least square (OLS) analytical method. Findings based on analysis showed that there is a relationship between exchange rate changes and changes in Nigeria’s balance of trade and that also export rate greatly affects balance of trade. Based on the findings, valuable information on the interaction of foreign exchange and balance of trade were proffered on how policies should be implemented.
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Tags: Arrangee, Autonomous Foreign Exchange Market-AFEM, Balance of Trade, Banking and Finance-Thesis-2012, Central Bank Role-Exchange Rate Management, Current Account Deficits, Durbin Watson’s Test, Evaluation Method, Exchange Rate Determinants, Exchange Rate Policy, External Trade Direction, Fixed Exchange Rate, Flexible Exchange Rate, Foreign Exchange, Foreign Exchange Market, Inflation Differentials, Interbank Foreign Exchange Market-IFEM, Interest Rate Differentials, Model Specification, Naira Devaluation, Nigeria’s Foreign Exchange Regime, Ordinary Least Square, Private Buying-Foreign Currencies, Public Debt, Second Tier Foreign Exchange Market-SFEM, Terms of Trade, Trade Balance