Aug 2026· International Journal of Economics and Financial Management· pp. 60· 0 citations
Abstract
The study sought to explore the effects of macroeconomic volatility and interest rate differential
on stock market liquidity in Nigeria and South Africa from 1984 to 2022.The gross domestic
product and Interest rate differentials were used as explained variables, while the money supply
and exchange rate served as explanatory variables. The base year (1984) was marked by Food
and Agricultural Organization (FAO)Launched by the United Nations to assist in alleviating
famine in Africa. A population of 54 countries in Sub-Sahara Africa was sampled, while two
countries were selected based on the volume of their market transactions over the years under
study. We carried out stationarity test, co-integration test, parameter stability test, arch effect and
OLS. Findings indicated that (i) Macroeconomic volatility have a positive and significance effect
on the stock market liquidity in Nigeria, while in South Africa, Macroeconomic volatility have
positive and non-significance effect on the stock market liquidity .(ii) Interest rate have a negative
and non-significance effect on the stock market liquidity in South Africa and Nigeria .It was
recommended that government need to enact sound monetary policies in order to enhance
economic growth in both countries under study. The government will also need to benchmark for
best practices in monetary policy development from those economies that are more advanced in
order to develop better monetary policies that can improve the performance of the stock market.
(ii)The government need to create an enabling environment and promote infrastructural
development to facilitate the ease of stock market activities in particular and financial system of
both countries.
This study investigated the impact of key macroeconomic indicators on the price movements
of listed stocks in the Nigerian capital market, with a view to understanding the extent to
which macroeconomic fundamentals influence equity performance. Drawing on quarterly
data from 2013 to 2023, the study focused on indicators such as inflation rate, exchange
rate, interest rate, and gross domestic product (GDP) growth rate. Using an econometric
approach, specifically multiple regression, the research evaluated both short and long-term
relationships between the selected macroeconomic variables and the Nigerian Stock
Exchange All-Share Index (NGX ASI), which served as the proxy for stock price movement.
The findings revealed a significant long-run relationship between macroeconomic
indicators and stock prices, with exchange rate and inflation exerting the most pronounced
effects. GDP growth rate showed a positive but lagged impact on stock market performance,
while interest rate exhibited a negative significance, consistent with theoretical
expectations. This study contributed to the empirical literature by providing evidence from
an emerging market context and offers policy implications for regulators, investors, and
portfolio managers seeking to incorporate macroeconomic signals into investment decisionmaking processes.
I. Areghan· IIARD INTERNATIONAL JOURNAL...· 0 citations
This study evaluated the relationship between oil price fluctuations and exchange rate movements
on stock market volatility in Nigeria. As a mono-product, oil-dependent economy, Nigeria's
macroeconomic indicators and financial markets are highly susceptible to external shocks,
particularly from global crude oil price variations and foreign exchange dynamics. Using daily
time-series data from November 20, 2024 to June 30, 2025 obtained from Central Bank of Nigeria
Statistical Bulletin, and employed econometric models such as the Error Correction Model (ECM)
and Exponential Generalized Autoregressive Conditional Heteroskedasticity (EGARCH), the
study investigated the magnitude and direction of influence of oil price and exchange rate on stock
market volatility. Findings revealed that oil prices significantly impact the Nigerian stock market,
whereas, exchange rates insignificantly impact the Nigerian stock market, with oil price shocks
causing more pronounced and persistent volatility. The results also indicated that exchange rate
depreciation contributes to investor uncertainty, which further amplifies stock market fluctuations.
Moreover, asymmetric effects were observed, with negative shocks exerting a stronger influence
than positive ones. The study concludes that Nigeria’s heavy reliance on oil revenues and unstable
exchange rate regime are central drivers of stock market instability. Policy recommendations
include that the Central Bank of Nigeria (CBN) should move toward a unified, market-determined
exchange rate system to reduce distortions and speculative activities. Again, investors should be
cautious of the high volatility and asymmetric response of the Nigerian stock market to negative
events, among others.
Chukwu Agwu Ejem· International Journal of Eco...· 0 citations
Macroeconomic instability has been a major issue in emerging economies, as volatility in key
indicators can affect market behaviour. In Nigeria, volatility in exchange, interest, and inflation
rates has persistently raised concerns about its implications for stock market returns and investor
confidence. This study investigates how fluctuations in exchange, interest, and inflation rates affect
investor behaviour and market returns on the Nigerian Exchange. The secondary time-series data
from 1986 to 2024. The ARCH and GARCH models were both employed to estimate the data
collated. Our findings show that stock returns responded positively to changes in exchange and
inflation rates, while interest rates responded negatively to stock returns in Nigeria. The study,
therefore, concludes that macroeconomic stability is a key factor in improving stock market
performance and investment confidence. The study recommends effective macroeconomic
management to stabilize movements in exchange rates, interest rates, and inflation to maintain the
growth and efficiency of the Nigerian capital market.
A. Dumani· IIARD INTERNATIONAL JOURNAL...· 0 citations
This study examines the effect of inflation dynamics on sectoral stock market performance in Nigeria, focusing on firms listed on the Nigerian Exchange Group (NGX) from 2015 to 2024. A quantitative panel-data research design was used, covering 72 listed companies, with sector-specific analysis focused on five major sectors, and yielding 720 firm-year observations. Data on inflation, the exchange rate, the interest rate and GDP growth were derived from national statistical and regulatory sources, while firm-level data were obtained from annual reports. The data were analysed using panel regression, including Pooled OLS, Fixed Effects and Random Effects estimation; the Hausman test was used to select the appropriate model. The results revealed that Nigeria's inflation rate increased markedly from 9.01 percent in 2015 to 34.80 percent in 2024. Inflation had a statistically significant negative effect on sectoral stock returns (β = -0.432, p < 0.001), while the preferred model explained 47.2 percent of the variation in returns, with significant variation across sectors. The Consumer Goods and Banking sectors were the most negatively sensitive, while the Oil and Gas sector was relatively resilient, supported by some benefits from deregulation. Returns were positively related to exchange rate depreciation, GDP growth and firm profitability. The study found that inflation is a major and economically relevant factor influencing sectoral performance in Nigeria, with significant variation across sectors. It recommends inflation-targeting monetary policy, better coordination between fiscal and monetary policy, and sector-specific measures to enhance stock market resilience and investor confidence.
Unknown authors· Journal of global economics,...· 0 citations
This study examined the impact of international trade on domestic price stability in Nigeria
from 1990 to 2023. The objective was to evaluate how exports, imports, and exchange rate
fluctuations influence inflation in the country. Annual time series data were sourced from the
Central Bank of Nigeria Statistical Bulletin and World Development Indicators. The
Autoregressive Distributed Lag (ARDL) model was employed due to its suitability for analyzing
both short-run and long-run relationships among variables with mixed levels of stationarity.
The results revealed that exports exert a negative and significant effect on inflation, indicating
that increased export activities contribute to domestic price stability. Conversely, imports have
a positive and significant impact on inflation in the long run, suggesting that Nigeria’s heavy
dependence on imported goods drives inflationary pressures. Exchange rate fluctuations were
found to significantly affect inflation in the short run, implying that naira volatility transmits
to domestic prices. The error correction term was negative and significant, confirming a rapid
adjustment to long-run equilibrium after short-term shocks. The study concludes that
international trade dynamics play a vital role in Nigeria’s inflation behaviour and recommends
policies that promote export diversification, reduce import dependence, and stabilize the
exchange rate to sustain domestic price stability.
Bosco Itoro Ekpenyong· INTERNATIONAL JOURNAL OF SOC...· 0 citations
This study investigates the impact of monetary policy measures, such as money supply, exchange
rate, and liquidity ratio concurrently, on economic growth in Nigeria from 1987 to 2022. Real
gross domestic product (RGDP) was the dependent variable with monetary policy (MP) and
liquidity ratio (LR) as the independent variables while exchange rate (EXR) as the control
variable. Data for the study were obtained from CBN statistical bulletin and WDI. Utilizing the
ADF and PP tests were utilized for analyses, while the ARDL bound tests was adopted for
cointegration between the variables. It was found that money supply (MP) has a significant
negative short-run impact, while liquidity ratio (LP) and exchange rate (EXR) have significantly
negative long-run impacts on Nigeria's economic growth. Moreover, it was further discovered
that all the explanatory variables are crucial in ascertaining economic growth of Nigeria, based
on the statistical significance. It is recommended that policies that ensure credit availability in
deposit banks should be implemented to increase the liquidity of money available to investors for
economic boost and that exchange rate stability policies such as increasing foreign exchange
reserves be considered necessary.
Unknown authors· International Journal of Eco...· 0 citations
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