THE IMPACT OF EXCHANGE RATE ON THE ECONOMIC GROWTH OF NIGERIA

The study analyzed the impact of exchange rate on the Nigeria’s economic growth for the period of 1981-2023. Time series data on RGDP, exchange rate, import, export and inflation rate were obtained from Central Bank of Nigeria from 1981-2023. The variables were integrated of the same order and therefore evaluated using Ordinary Least Multiple Regression analysis (OLS).The major findings of the study is that export and inflation have positive and significant relationship with Real Gross Domestic Product (RGDP), whereas import and exchange rate have negative but insignificant impact on RGDP. It was also established that, after adjustment the variables included in the model explained 85% of variations in the dependent variable (RGDP). The study recommends among others that import has a negative impact on RGDP, therefore importation should be reduced to only machines and equipments that can be used for further productions; value should be added to our exports in order to generate more income from it, our result shows that, export has a positive and significant impact on RGDP and inflation should be reduced to the barest minimum, with the use of monetary policy instruments, since increase in RGDP figure does not mean increase in productivity in the face of inflationary pressure.