Impact of Exchange Rate on the Economic Growth in Nigeria from 1990-2025: An ARDL Approach

Abstract: This paper examined the impact of exchange rate on Economic Growth in Nigeria for the period from 1990 to 2025 making use of annual time series data sourced from the database of World Development Indicator (WDI) and Central Bank of Nigeria (CBN) 2025 Statistical Bulletin. The method employed for this investigation was the Autoregressive Distributed Lag (ARDL) approach of estimation, the data analysis began with the finding out the unit root properties of the variables. The Philips-Perron (PP) unit root test was employed and the test revealed that the variables were either integrated of order I(0) or order I(1). This required the use of Bounds testing approach in finding out the co integration among the variables. Analysis using the Bounds testing approach for co integration revealed the existence of long run relation among the variables of the models. In determining the impact of exchange rate on the Economic Growth in Nigeria, the study estimated an ARDL model. The findings from the study revealed that exchange rate has significant positive effect on the exchange rate in Nigeria in the long and short run. The study recommends that government through CBN monetary policy instrument should make exchange rate stable so as to trigger the desired economic growth in the country.