Empirical investigation of internal and external shocks on exchange rate volatility in Nigeria: Evidence from GARCH (1 1) forecasting technique

ISBN-13: 9783668911376 / Angielski / Miękka / 2019 / 96 str.

Ugwuja Chinonso Oliver

Opis

Bachelor Thesis from the year 2017 in the subject Economics - Case Scenarios, grade: 2.1, University of Nigeria, course: ECONOMICS, language: English, abstract: The embracement of the International monetary funds' (IMF) structural adjustment programme (SAP) in 1986 brought the Bretton-Woods system which marked a period of the largest experiment of the pegged exchange rate regimes in the post-World War II era to its knees. Ever since then, there has been a recoded high degree of volatility in the exchange rate of the naira vis-à-vis the US dollars.In this regard, this study seeks to examine other sources of shocks to the exchange rate fluctuations in Nigeria relying on time series data covering the periods 1986-2015. To execute this effectively, the Generalized Autoregressive Conditional Heteroscedasticity (GARCH) model introduced by Tim Bollerslev (1986) was used to decompose these shocks into internal and external sources. Also, the time series properties of the data used were explored and the stationarity conditions of the chosen variables were examined by the help of ADF unit root test under three different test regression equations.However, the GARCH (1 1) volatility forecasting result reveals that volatility shock is present and persistent and concludes that the fluctuations in the Real exchange rate of the naira is responsive to both domestic and international shocks. Consequently, this study recommends that policies be adopted to tame the degree of volatility in exchange rate because of the deleterious effect it could have on foreign transactions. Furthermore, to make the work more enticing and attractive to the readers, we sectionalized this study into Chapters; chapter one for introduction, chapter two for literature review, chapter three for Research methodology, chapter four for the presentation and analysis of empirical findings and chapter five.

O autorze

Ugwuja Chinonso Oliver (ACIEHS, ACICRM, GNIM) is a financial and Business Analyst, a Chartered Manager certified by the Nigerian Institute of Management, and a certified Safety Officer. He has been a research consultant since 2016 with over five published research papers. Chinonso is proficient in statistical and econometric modeling with special skills in using E-VIEWS, STATA, SPSS, EXCEL, and other Microsoft Office suites. His position has been beneficial to many scintillating researchers in economics and other related disciplines. His management profession as a Director and Management Accountant has continuously helped DanWhite Global Resources Nigeria Limited grow the company's profit and increase its customer base. His writing skills have attracted sponsorship to a lounge where he worked as an inventory controller/internal audit. Chinonso studied economics at the University of Nigeria. He obtained a Second Class Upper Division Level (Magnum Cum Laude) and was honored as a policy critic of the year 2017. Chinonso envisions a world where adequate manpower in business and management will be available to mitigate the high failure rates of Small and Medium-scale businesses. He obtained the West African Examinations Certificate (WAEC) with excellent results.at Saint Teresa's College, Nsukka in 2012. His passion for educational advancement and contributing to the development of the global economy by helping SMEs to grow compelled him to take online courses and training in Digital Marketing and Customer Relationship Management (CRM), and obtained a Postgraduate Diploma. He has written an online article entitled 'The Role of Customer Service in a Marketing Campaign. His professional career has been in the business sector and this contributes to why he has undertaken to help both existing and newly established small and medium-scale businesses to grow so that employment in this sector will be secure and lucrative as well. Chinonso partners with Formazione Business School as a facilitator for Skill Acquisition and Entrepreneurship Development (SAED), where he trains business owners in various skills such as Bookkeeping/Accounting and business management. Chinonso is a volunteer with the Financial Inclusion and Literacy Group where he helped petty traders to obtain low-interest loans to fund their business ideas. These notwithstanding, he still seeks international exposure and opportunities to amplify his performance in Nigeria, Africa, and, the world.