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, Enhancing Office Management Efficiency through Artificial Intelligence and ICT Innovations , Applied Science, Computing, and Energy: Vol. 1 No. 1 (2024): VOLUME 1 ISSUE 1
- Edikan Nnabuk, Ifeanyi Samson Eze, Nnabuk Okon Eddy, 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
Similar Articles
- Ndukwe Peter Uchechukwu, Ejikeme Ezo Igbokwe, Dike Ijeoma Inyang, Spatio-Temporal Characterization and Acoustic Mapping of Ambient Noise Levels at Ogbonnaya Onu Polytechnic, Aba, Nigeria: A Multi-Source Compliance Analysis , Applied Science, Computing, and Energy: Vol. 4 No. 5 (2026): Vol 4, Issue 5
- 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
- Paschal Bisong Nyiam, Afolayan A. Sunday, On The Application Of Multi-Objective Linear Programming To Niger Mills Company Plc Calabar, Cross River State, Nigeria , Applied Science, Computing, and Energy: Vol. 4 No. 5 (2026): Vol 4, Issue 5
- 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
- Grace Ritsemwa Dallong-Opadotun, Legal Liability for Artificial Intelligence-Assisted Nuclear Safety Decisions: A Comparative Assessment of Operator Responsibility, Regulatory Accountability, and Compensation for Nuclear Damage , Applied Science, Computing, and Energy: Vol. 4 No. 6 (2926): Volume 4, Issue 6
- 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
- Adewunmi O. Wale-Akinrinde, Toluwalase Damilola Osanyingbemi, Oluwapelumi Adebukola Fadairo, Precious Mkpouto Akpan, Real- Time Bi-enhanced Product Performance Intelligence for Driving Sustainable Business Expansion , Applied Science, Computing, and Energy: Vol. 1 No. 1 (2024): VOLUME 1 ISSUE 1
- Silas Abahia Ihedioha, Bright Okore Osu, Samuel Chidiebere Ani, Modeling Urban Heat Island Dynamics Using Fractional Calculus: A Comparative Study with Classical Heat Diffusion Models , Applied Science, Computing, and Energy: Vol. 4 No. 1 (2026): Volume 4 Issue 1
- Moses Oluwasegun Odewale, Moses Olagoke Odejobi, Olanrewaju Oluwaseun Ajayi, AI-Driven Self-Optimizing Framework for Real-Time Wireless Network Performance Enhancement , Applied Science, Computing, and Energy: Vol. 1 No. 1 (2024): VOLUME 1 ISSUE 1
- Joseph Amajama, Eyime Echeng Eyime, Sameul Eyen, Efa Ikpi, Effect of Wooded Channels on 519.25-MHz UHF Radio Wave Propagation , Applied Science, Computing, and Energy: Vol. 2 No. 2 (2025): VOLUME 2 ISSUE 2
You may also start an advanced similarity search for this article.