Backstory
Across every stakeholder spectrum in the Nigerian economy (i.e. investors, consumers, policymakers or economic observers), one persistent recurring topic is the incessant Naira depreciation against major currencies.
- Specifically, against the major currencies, (USD, GBP, JPY, EUR), the long-run relationship between the Naira and these currencies is a linear depreciating relationship.
Most economists agree that there are broadly eight (8) factors that influence a country’s exchange rate.
- Quantitative factors include inflation rate, interest rate, current account deficit, size of public/government debt and GDP growth rate.
- Qualitative factors include confidence levels in government economic policies, degree of currency speculation and political stability.
You can read more here and here
Source: Nairametrics
