Foreign Exchange Rate Factors and Firm Performance: An Empirical Analysis of Nigeria’s Manufacturing Sector
Keywords:
Macroeconomic variables, Return on equity, Granger causality, OLS regression, Model validationAbstract
This study investigates the impact of key macroeconomic variables on the return on equity (ROEQ) of listed manufacturing firms in Nigeria. Using Ordinary Least Squares (OLS) regression analysis, the research examines the influence of real effective exchange rate (REER), interest rate (INTR), inflation rate (INF), and market structure and pricing (MSP) on firm performance. Diagnostic tests, including heteroskedasticity tests, Ramsey RESET test, and Augmented Dickey-Fuller (ADF) test, were conducted to ensure model validity. The Granger causality test identified bidirectional relationships between REER and ROEQ, as well as INF and ROEQ. The OLS results indicate a strong predictive power, with an adjusted R² value of 0.984, confirming that the independent variables explain 98% of the variations in ROEQ. The findings highlight the critical role of exchange rate fluctuations, interest rate policies, and inflation stability in shaping firm performance, offering valuable insights for policymakers and industry stakeholders.
Downloads
Published
Issue
Section
License
Authors retain copyright and grant the journal the right of first publication. Articles published in this journal are licensed under a Creative Commons Attribution 4.0 International License (CC BY 4.0), permitting unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.
How to Cite
Most read articles by the same author(s)
- Edikan Nnabuk, Gloria Udeokpote, Enhancing Nuclear Knowledge Management for Sustainable Development in Nigeria: Challenges, Strategies, and Lessons from International Case Studies , Applied Science, Computing, and Energy: Vol. 2 No. 1 (2025): VOLUME 2 ISSUE 1
- Edikan Nnabuk, Enhancing Office Management Efficiency through Artificial Intelligence and ICT Innovations , Applied Science, Computing, and Energy: Vol. 1 No. 1 (2024): VOLUME 1 ISSUE 1
Similar Articles
- Mu’awiya Baba Aminu, Khaurat Kadiri, Ayobami Oni, Rabi Elabor, Machine Learning–Driven Remote Sensing Framework for Predicting Groundwater Pollution under Climate Change Scenarios , Applied Science, Computing, and Energy: Vol. 4 No. 2 (2026): Volume 4 Issue 2
- Ukeme Nsikak Essien, Bright Aiyehirue Agwogie, Quantitative Assessment of Carbon Sequestration Potential and Biomass Accumulation in Selected Forest Ecosystems of Southern Nigeria , Applied Science, Computing, and Energy: Vol. 4 No. 3 (2026): Volume 4, Issue 3
- Nsentip George Afangide, Abasi-ada Nnabuk Eddy, Quantitative Analysis of Strategic Communication and Media Relations: Data-Driven Approaches for Professional Excellence in Public Engagement , Applied Science, Computing, and Energy: Vol. 3 No. 3 (2025): Volume 3, Issue 3
- Anthony Ekedegwa, Evans Ashigwuike, Abdullahi Mohammed , Hybrid of Support Vector Regression, Genetic Algorithm, and Bat Optimization Algorithm Integrated with ANN for Short-Term Load Forecasting , Applied Science, Computing, and Energy: Vol. 2 No. 2 (2025): VOLUME 2 ISSUE 2
- Egbuhuzor Udechukwu Peter, Okoro Enyinnaya Okoro, Enhancing Rainfall-Runoff Prediction Accuracy using Artificial Neural Networks: A Case Study of Bida, Nigeria , Applied Science, Computing, and Energy: Vol. 3 No. 1 (2025): VOLUME 3 ISSUE 1
- Reuben Oluwabukunmi David, Job Obalowu, Tasi’u Musa, Yahaya Zakari, Beyond Normality: OGELAD Error Distribution in Energy Prices Volatility Forecasting , Applied Science, Computing, and Energy: Vol. 3 No. 1 (2025): VOLUME 3 ISSUE 1
- David Adetunji Ademilua, Edoise Areghan, Cloud Security Vulnerabilities: A Comprehensive Survey and Analysis of Risks in IaaS, PaaS, and SaaS Models with Practical Data and Methodology for Mitigating Breaches , Applied Science, Computing, and Energy: Vol. 2 No. 1 (2025): VOLUME 2 ISSUE 1
- Ifiok Dominic Uffia, Ofonimeh Emmanuel Udofia , Iniobong Bruno Nsien,, Idem Udo Uko, Christiana Samuel Udofia, Ecological Impacts of Anthropogenic Activities on Biodiversity and Ecosystem Functioning in Changing Climates , Applied Science, Computing, and Energy: Vol. 2 No. 2 (2025): VOLUME 2 ISSUE 2
- Anthony Ekedegwa, Evans Ashiegwuike, Abdullahi Mohammed S. B., Hybrid Grey Wolf Optimization and Gorilla Troop Optimizer Algorithms in ANN for Short-Term Load Forecasting , Applied Science, Computing, and Energy: Vol. 2 No. 2 (2025): VOLUME 2 ISSUE 2
- Precious Mkpouto Akpan, Adewunmi O. Wale-Akinrinde, Toluwalase Damilola Osanyingbemi, Chinelo E. Okonkwo, Oluwapelumi Adebukola Fadairo, Adaptive Product Growth Models Powered by Predictive Analytics and Organization Risk Signals , Applied Science, Computing, and Energy: Vol. 1 No. 1 (2024): VOLUME 1 ISSUE 1
You may also start an advanced similarity search for this article.