THE FINANCIAL GLOBALISATION AND ITS EFFECT ON EXCHANGE RATE IN NIGERIA"

Financial globalisation has become a defining feature of the modern international economic system, characterized by increased cross-border capital flows, financial market integration, and international investment activities. This study examines the effect of financial globalisation on exchange rate dynamics in Nigeria. As a developing economy, Nigeria has experienced significant exposure to global financial markets through foreign direct investment, portfolio investment, and international trade, which have influenced the behavior and stability of the Nigerian naira. The research analyzes how financial openness and global capital mobility affect exchange rate volatility, monetary policy effectiveness, and overall macroeconomic stability in Nigeria. It highlights the role of financial institutions, global market trends, and external shocks in shaping exchange rate movements. The study also evaluates the implications of financial globalisation for economic growth, trade competitiveness, and financial stability. Findings indicate that while financial globalisation can attract foreign investment and promote economic development, it may also increase exchange rate volatility due to sudden capital inflows and outflows. The study therefore recommends stronger financial regulations, improved monetary policy coordination, and diversification of the Nigerian economy to mitigate the adverse effects of global financial shocks. Ultimately, effective management of financial globalisation is essential for maintaining exchange rate stability and sustainable economic growth in Nigeria.