PREDICTION OF THE NIGERIAN EXCHANGE RATE USING TIME SERIES ANALYSIS FROM (2000 TO 2020)

Abstract

Following the initiation of the structural adjustment program me in 1986, which signaled the start of the devaluation of the domestic currency in relation to the US dollar, the exchange rate policy seems to be crucial for the Nigerian economy. The primary aim of the study is to utilize time series analysis to investigate the currency rate of Nigeria from 2000 to 2020. The 2020 statistical bulletin of the Central Bank of Nigeria presented us with the time series data. The model was derived using the ordinary least squares estimation technique. In order to ensure the proper determination of the Naira's value relative to other currencies, it is imperative for the Central Bank of Nigeria to enforce rigorous restrictions on its foreign exchange policy. The Naira's depreciation as a result of unethical bank practices should be looked into, and guilty parties should be reprimanded appropriately. In order to enhance productivity, it is advisable to provide local manufacturers with subsidies, tax holidays, and various other incentives. In order to enhance foreign currency inflow from exports, it is imperative to execute an industrial plan that establishes a strong link between the manufacturing and agriculture sectors.