Assessing the Impact of Inflation and Exchange Rate on Nigerian Gross Domestic Product (1981-2022)

Chukwudi Anderson Ugomma *

Department of Statistics, Faculty of Physical Sciences, Imo State University, Owerri, Nigeria.

Samuel Chimuanya Chijioke

Department of Statistics, Faculty of Physical Sciences, Imo State University, Owerri, Nigeria.

*Author to whom correspondence should be addressed.


Abstract

This study evaluated the impact of inflation and exchange rate on the Nigerian Gross Domestic Product (GDP) from 1981 to 2022. The data for this study were obtained from Central Bank of Nigeria Statistical Bulletin. Multiple Linear Regression model was adopted for the study to determine the relationship between the GDP, the inflation and exchange rates and the result showed that there is a significant relationship with the p-value (0.005). The result also showed with Ordinary Least Square (OLS) method that inflation rate has a negative impact on the Nigerian GDP while exchange rate is significant with (p-value <0,005) over the years of study. The value of the coefficient of variation R2 for this research is 92.2% indicating that inflation and exchange rate account for about 92% of the variation in the GDP over the years of study. It was observed there was an increase in exchange rate and price level is also detrimental to the economic growth, this means it contributes to the growth of Nigerian GDP over the period of study.

Keywords: Gross Domestic Product (GDP), inflation rate, exchange rate, ordinary least squares method (OLS)


How to Cite

Ugomma, C. A., & Chijioke , S. C. (2024). Assessing the Impact of Inflation and Exchange Rate on Nigerian Gross Domestic Product (1981-2022). Asian Journal of Probability and Statistics, 26(5), 30–41. https://doi.org/10.9734/ajpas/2024/v26i5616

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