Exchange Rate Fluctuation and Economic Growth in Nigeria

The quotation “variety is the spice of life” is a prudent one. It reflects as fluctuation has somehow impact on the economy of Nigeria. Experts say that the exchange rate is a crucial metric of the economy that reflects underlying strength and the competitiveness with world economies. The fluctuation also appears when someone sends money to Nigeria, i.e. native country. 

Impact of Exchange Rate Fluctuation

It is pertinent to mention here that in different countries, the impact of exchange rate fluctuations on economic growth differs. On the other hand, exchange rate fluctuations influence economic growth. This is the degree of development of each nation’s financial systems. Similarly, it reveals that current ideas highlight the high connection between economic growth and innovation.

Over the years, Nigeria’s monetary authorities have implemented different exchange rate structures. During the 1960s, it switched to a pegged format from a fixed regime during the mid-1980s and completely other forms of floating government after 1986.

Send Money to Nigeria

Sending money to Nigeria becomes very easy with the assistance of ACE Money Transfer. Anyone who is living overseas can quickly transfer money to Nigeria. In this modern world, they are providing amazing services for many beneficiaries.

Many Nigerians who move abroad for work, support their families by sending money with different channels. The trend of online money transfer increased after the COVID-19 pandemic. People prefer online transactions, as it offers low fee and better exchange rates in comparison with the traditional services. Aside from this, it has a safe, quick, and secure procedure.

Undoubtedly, this way of sending and receiving money assist the economic growth of Nigeria. The family of the sender utilizes this money in their necessities and investment. One who receives money use it for different things. After spending, this amount adds to the economy of the country.

Impact of Exchange Rate on Domestic Prices

Exchange rate fluctuations affect domestic prices. In general, when a currency depreciates, if the country is a foreign price taker, higher tariffs will result, whereas lower import costs will result through appreciation. The theoretically higher cost of imported inputs and the weakening of the exchange rate boost marginal costs and contribute to higher prices of domestically generated goods.

Monetary Policy of Nigeria

The current policies of the Government of Nigeria’s are trying to prove its monetary policies fruitful for its nation. Similarly, a large community in Nigeria is trying to attract foreign businesses. These steps can assist the growth of the economy of the country to a vast extent.

Therefore, it will not be wrong to say that the country’s economy significantly affects the fluctuation of the exchange rate because it describes the degree of financial development. On the other hand, it also positively affects the economy if someone sends money to Nigeria from any other country. For home remittances, ACE Money Transfer is a one-stop solution for many expats. Thus, the efforts of ACE are favourable for the economy of this developing country.