Impact of Naira Depreciation and Inflation on the Nigerian Economy
Adewunmi, Abdullah (2023)
2023
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Julkaisun pysyvä osoite on
https://urn.fi/URN:NBN:fi:amk-2023122038674
https://urn.fi/URN:NBN:fi:amk-2023122038674
Tiivistelmä
The aim of this thesis was to explore the intricacies of the Nigerian economy, while focusing on the impact of naira depreciation and inflation. The study also intended to contribute to existing knowledge by investigating the relationship between naira depreciation, inflation and the Nigerian economy. Additionally, the study sought to provide a deeper insight into the effects of naira depreciation and inflation on the Nigerian economy. It began with an overview of the economic sphere of Nigeria and then delved into a review of existing literature. The reviewed literature aimed to provide a foundation of knowledge on the topic, identify experts for the subject and discover current research in the issue.
The study adopted a quantitative research methodology to evaluate the relationship between naira depreciation, inflation, and key economic indicators. Data was sourced from credible international organizations including the World Bank, IMF, and Statista that served as the foundation for analysis. A thorough investigation was conducted utilizing Excel for correlation and regression analysis, as it was difficult to make use of SPSS for data analysis. The process involved a comprehensive examination of statistical relationships that exist between the variables. This was essential to guarantee the reliability of the study.
The results showed a strong positive association between GDP and naira depreciation, suggesting that a weaker naira was accompanied by an increase in economic output. This emphasized the potential benefits of a weak naira on the overall economy. A slight negative relationship between GDP and inflation highlighted the difficulties brought on by inflationary pressures. Furthermore, a somewhat positive relationship between the exchange rate and foreign direct investment (FDI) indicated that a weak naira could attract foreign investment.
The study adopted a quantitative research methodology to evaluate the relationship between naira depreciation, inflation, and key economic indicators. Data was sourced from credible international organizations including the World Bank, IMF, and Statista that served as the foundation for analysis. A thorough investigation was conducted utilizing Excel for correlation and regression analysis, as it was difficult to make use of SPSS for data analysis. The process involved a comprehensive examination of statistical relationships that exist between the variables. This was essential to guarantee the reliability of the study.
The results showed a strong positive association between GDP and naira depreciation, suggesting that a weaker naira was accompanied by an increase in economic output. This emphasized the potential benefits of a weak naira on the overall economy. A slight negative relationship between GDP and inflation highlighted the difficulties brought on by inflationary pressures. Furthermore, a somewhat positive relationship between the exchange rate and foreign direct investment (FDI) indicated that a weak naira could attract foreign investment.