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This study examined the impact of exchange rate movements on the agricultural sector in
Nigeria. Time series data and Ordinary Least Square (OLS) estimation technique were
employed in this study to address the specified objective. The variables employed in this
study were exchange rate, Agric GDP, Government Capital Expenditure, foreign direct
investment, credit to private sector, and Lending interest rate. The result showed that
exchange rate movements play a significant role in the agric sector performance in Nigeria.
Specifically, the findings showed that exchange rate, government capital expenditure, foreign
direct investment and lending interest rate were positively related to agric GDP while credit
to private sector was negatively related. Co-integration approach was also applied to
determine the long-run relationship between the variables. The results revealed that the
variables have a statistically significant impact on the agricultural sector in the long run. The
study recommended that the apex bank should keep a close watch on exchange rate
developments in order to enhance exchange rate stability which will contribute to the
development of the agric sector.
