Impact of interest rate differential, exchange rate changes and political stability on Foreign capital inflow in Nigeria: Discrete threshold regression model

Odionye, Joseph Chukwudi; Ojiaku, Ethelbert Ukachukwu; Uba, Chiwuike N.

doi:10.1080/23322039.2023.2203590

Cited by 5 publications

(3 citation statements)

References 27 publications

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“…Furthermore, the statistical significance of this REERVOL in the long-run estimations supports the idea that foreign investors are impacted by both short-and long-term fluctuations in REERVOL. This result is in direct accordance with earlier empirical research conducted by Adokwe et al (2019), Odionye et al (2023); and Akinlo and Onatunji (2021). This finding suggests that Nigeria's level of REERVOL deters FDI.…”

Section: Discussionsupporting

confidence: 93%

“…According to Obi (2017), SAP also noted significant fluctuations in currency rates when there was uncertainty about the inflation rate in the economy. A significant contributing element to the fluctuations in the exchange rate during this time period was external shocks brought on by the worldwide fluctuations in the pricing of oil and agricultural commodities, which are major sources of foreign exchange earnings and exports from Nigeria (Odionye et al, 2023). Nigeria is going through serious trade shocks in the current oil period due to the constant swings in the price of oil around the world.…”

Section: Source: World Development Indicators (Wdi)mentioning

confidence: 99%

“…Similarly, Odionye et al (2023) examined how changes in interest rates, exchange rate fluctuations, and political stability affected foreign capital inflows into Nigeria between 1981 and 2021. A discrete threshold regression model (DTRM) was employed in the investigation.…”

Section: Review Of Empirical Literaturementioning

confidence: 99%

See 2 more Smart Citations

The Influence of Exchange Rate Fluctuation on Foreign Direct In-vestment in Nigeria (1986-2022)

Udoinyang,

Udoinyang

2024

JEIME

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Using yearly data series spanning 36 years, from 1986 to 2021, the research empirically evaluates the influence of exchange rate fluctuation on foreign direct investment in Nigeria. The study’s objectives were focus on examining the extent of exchange rate volatility in Nigeria and ways by which exchange rate volatility impact on foreign direct investment in Nigeria. Secondary source of data was employed from world development indicator (WDI) and central bank of Nigeria (CBN). Autoregressive Distributed Lag (ARDL) were employed and the GARCH (1, 1) model was used in investigating the model built and were analyzed using multicollinearity with the use of Augmented Dickey-Fuller (ADF) test to verify that the variables are stationary in order to make sure the estimated results are not erroneous. Findings from the study shows that real exchange rate volatility (REERVOL) has a long-term and short-term detrimental impact on FDI and negative long- and short-term interest rate coefficients demonstrate that an unfavorable interest rate exacerbates the already diminishing foreign direct investment (FDI) flows to Nigeria as a result of REERVOL. The policy was recommended for improving FDI through effective exchange rate management.

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Section: Discussionsupporting

confidence: 93%

Section: Source: World Development Indicators (Wdi)mentioning

confidence: 99%

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The Influence of Exchange Rate Fluctuation on Foreign Direct In-vestment in Nigeria (1986-2022)

Udoinyang,

Udoinyang

2024

JEIME

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Threshold-based asymmetric reactions of trade balances to currency devaluation: fresh insights from smooth transition regression (STR) model

Odionye

Odo

Ikpe³

et al. 2023

International Review of Applied Economics

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Economic Policy Uncertainty and Stock Market Index: Fresh Insights from Augmented-ARDL and Multiple Structural Breaks

Odionye,

Ojiaku,

Okpara

et al. 2024

J. Intl Econ. Comm. Policy.

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This study provides unique insights into the link between economic policy uncertainty (EPU) and stock market index in Sub-Saharan African (SSA) countries. Basically, the dearth of evidence in this perspective, especially in the context of SSA motivates this new assessment. Thus, on account of the monthly longitudinal series for 11 SSA countries over 2014M1–2023M6, the novel multiple structural break test in panel (MSBP) and cross-sectional ARDL (CS-ARDL) provide the following upshots: first, the high level of EPU worsens the region’s stock index in the short run; second, there is a long-term negative but insignificant effect of EPU on the stock index; third, EPU significantly reduces the stock index in the three identified structural break regimes, but outside it, it is insignificant; fourth, the devastating influence of EPU on stock prices is more pronounced during the COVID-19 era demonstrating that the response of the region’s stock market to EPU is highly sensitive to global shocks. The policy implication from the major findings is for the government authorities to put up plans that can strengthen the stock markets’ resilience to economic policy-induced uncertainty.

show abstract

Impact of interest rate differential, exchange rate changes and political stability on Foreign capital inflow in Nigeria: Discrete threshold regression model

Cited by 5 publications

References 27 publications

The Influence of Exchange Rate Fluctuation on Foreign Direct In-vestment in Nigeria (1986-2022)

The Influence of Exchange Rate Fluctuation on Foreign Direct In-vestment in Nigeria (1986-2022)

Threshold-based asymmetric reactions of trade balances to currency devaluation: fresh insights from smooth transition regression (STR) model

Economic Policy Uncertainty and Stock Market Index: Fresh Insights from Augmented-ARDL and Multiple Structural Breaks

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