Naira to Dollar Exchange Rate Fluctuations and Nigeria’s Balance of Payment

The authors analyze how changes in the value of naira affect country’s overall trade surplus or deficit. 2020 edition Central Bank Nigeria Statistical Bulletin was consulted for data on balance payments, exchange rate, openness, and inflation rates. Exchange rate fluctuation, are independent variables, payments (BOPs) is dependent variable. model’s variables’ stationary determined using ADF unit root test method. results tests show that after first difference, payment stabilized, while actual degree openness all remained stable at their respective levels. study’s variables” long-term relationship estimated an autoregressive distributed lag bounds test. There a long run link between as evidenced by estimates’ F-statistics 4.85, which larger than lower upper critical 3.23 4.35. Estimates also reveal run, positively impacted fluctuations real it negatively openness. As result, study suggests government should subsidize farmers who produce export goods order to reduce volatility dollar rate. national put aside more funds increase nation’s foreign reserve currency Rigid taxes imported one way prevent heavy reliance them.