Nigerian Stock Exchange Outlook in Relation to Cross-Exchange Rates and COVID-19 Global Pandemic: An Econometric Perspective

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Published: 2022-01-15

Page: 19-30

C. G. Amaefula *

Department of Mathematics and Statistics, Federal University, Otuoke, Bayelsa, Nigeria.

*Author to whom correspondence should be addressed.


The paper examined the outlook of Nigerian stock exchange (NSE) in relation to cross exchange rates and COVID-19 global pandemic. The monthly data sets on All-shares index (ASI), cross rates on US dollar(USEXR) and UK pound sterling(UKEXR) covered the period of 2008 to 2020.  Auxiliary autoregressive order three (AAR(3)) order of integration test (OIT) and ADF unit root  test showed the variables are I(1). Johansen co-integration test was used for long-run relationship test. Vector error correction model (VECM) and single multivariate regression equation for short-run and long-run were specified. The results showed that USEXR has significant adverse effect on NSE market both in the short-run and long-run. UKEXR has significant positive effect on NSE both in the short-run and long-run. At lag 1, UKEXR exacts negative influence on NSE. However, USEXR has more adverse effect on NSE than UKEXR. This could be as a result of USEXR role in the global market. COVID-19 pandemic is observationally adverse to NSE outlook but statistically insignificant for the period under study. Generally, adverse effect of cross exchange rates on NSE market tantamount same on the economy. Hence, the government should enact policies and avoid ventures that further devalue the strength of naira in the global exchange market.

Keywords: NSE, cross exchange rates, COVID-19, AAR(3) OIT, Co-integration test, VECM

How to Cite

Amaefula, C. G. (2022). Nigerian Stock Exchange Outlook in Relation to Cross-Exchange Rates and COVID-19 Global Pandemic: An Econometric Perspective. Asian Journal of Economics, Finance and Management, 4(1), 19–30. Retrieved from


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