Can Higher Inflation Lead to Currency Appreciation in Nigeria?

Chigbu Ezeji E., Eke, Charles N.


This work verified if higher inflation can lead to currency appreciation in Nigeria using an annual data from 1981 to 2013. The ordinary least square (OLS) method was adopted because of its best linear unbiased estimator property. The result showed that current inflation does not lead to currency appreciation in Nigeria, and rather what leads to currency appreciation is expected inflation. Although, monetary policy rate and export were significant in determining Naira value but they did not show the expected signs. The estimated model showed stability and all the explanatory variables used for the analysis accounted for 96% variation in explaining the direction of value of Naira as regards to appreciation or depreciation. The co-integration test showed that a long term relationship existed among the variables and they were stationary at order one I (1).

Keywords: Currency, Inflation, Co-integration and Appreciation

Full Text: PDF
Download the IISTE publication guideline!

To list your conference here. Please contact the administrator of this platform.

Paper submission email:

ISSN (Paper)2222-1700 ISSN (Online)2222-2855

Please add our address "" into your email contact list.

This journal follows ISO 9001 management standard and licensed under a Creative Commons Attribution 3.0 License.

Copyright ©