Impact Of Exchange Rate On Balance Of Payment In Nigeria

This paper empirically investigates the impact of exchange rate on the Nigeria External sector (the balance of payments position) using the Ordinary Least Square (OLS) method of estimation for data covering the period between 1970 and 2008. We found that exchange rate has a significant impact on the balance of payments position. The exchange rate depreciation can actually lead to improved balance of payments position if fiscal discipline is imposed. We also found out that improper allocation and misuse of domestic credit, fiscal indiscipline, and lack of appropriate expenditure control policie…