Effect Of Macroeconomic Variables On Manufacturing Sector Performance In Nigeria

Abstract

The volatility of exchange rate, inflation rate and interest rate in Nigeria is believed to undermine the performance of key sectors of the Nigerian economy. Thus, this study investigated the effect of these macroeconomic variables on Nigeria's manufacturing sector performance from 1999 to 2022. Ordinary least squares (OLS) technique was employed to analyze data collected from the Central Bank of Nigeria (CBN) Statistical Bulletin and World Development Indicators. Findings revealed that exchange rate positively and significantly affected manufacturing sector performance in Nigeria. On the other hand, it was revealed that the inflation rate and interest rate had negative and insignificant effects on the manufacturing sector performance in Nigeria. The study recommended that the Nigerian government strengthen its exchange rate policy to increase the export of its finished products, thereby increasing the manufacturing sector's performance.