Munich Personal RePEc Archive

Impact of Remittances from Nigerians in diaspora on Exchange rate Stability

Ilu, Ahmad Ibraheem (2019): Impact of Remittances from Nigerians in diaspora on Exchange rate Stability.

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Abstract

This Paper delves into examining the impact of remittances flow on exchange rate stability for the period 1990-2018. In an attempt to realize the major objectives of the study various writers’ works on relevant topics were exhaustively reviewed. The study utilizes annual time series data for its analysis and data on Exchange rate Remittances inflow as percentage of GDP, FDI and Oil price were collected for the period under review. Autoregressive distributed lag (ARDL) model approach was applied to estimate long run and short run relationship among the aforementioned variables. Both the short run and long run levels result seems to be consistent with each other that remittances is positively and significantly related to exchange rate meaning it leads to depreciation of Naira while FDI and oil prices found to appreciate the value of the Naira. The error correction model of the analysis is correctly sign and significant with 84% speed of adjustment per annum.

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