Crude Oil Production, Prices, Export And Foreign Exchange Rate, Do They Interact? Evidence from Nigeria (2006 – 2014) (Published)
The purpose of the study is to determine the extent to which Foreign Exchange Rate is influenced by or associated with crude oil selling price, crude oil export and crude oil production and the direction and magnitude of their granger causalities in Nigeria oil and gas sector (2006 -2014). Data were collected from Central Bank of Nigeria Statistical Bulletin and multiple regression, correlation and granger causality approach were adopted in the analysis of data. It was found that foreign exchange rate is positively influenced by volume of crude oil export and the selling price per barrel of crude oil, though not significantly; while a weak and insignificant relationship exists between crude oil export, crude oil production and foreign exchange rate. There is no Granger Causality running from any of the explanatory variables namely crude oil export, crude oil selling price and crude oil production, to foreign exchange rate. This implies that there are other factors that exert more far reaching impact on foreign exchange rate than crude oil production, export and sales price in Nigeria. Hence, the regulatory agencies in Nigeria such as the Central Bank of Nigeria (CBN) and Securities and Exchange Commission (SEC) should strengthen other macroeconomic and microeconomic variables in other to foster a stable foreign exchange regime.
Keywords: Causality, Correlation, Foreign Exchange, OPEC, Regression, crude oil
MACROECONOMIC VARIABLES AND SHARE PRICE MOVEMENTS IN NIGERIA BREWERY INDUSTRY: EVIDENCE FROM GUINNESS BREWERIES PLC (Published)
The aim of the research is to validate the relationship between macroeconomic variables and the movement of share prices in Nigeria brewery industry. The level of association of the variables is evaluated using the ordinary least squares method, modeled in form of multiple regression. Granger causality method was applied to examine the causality relationship among the variables in the short run. Augmented Dickey- Fuller (ADF) test was conducted while the Phillip-Perron’s (PP) test was applied for robustness check for stationary of the data series. All the variables except interest rate had the data series differenced at second difference. Interest rate was differenced at level and intercept. Significant relationship was found between inflationary rate and share price as well as between real gross domestic product and share price as about 95% of the variations in share price could be explained by the independent variables. Positive and strong correlation exists between share price and real GDP as well as exchange rate while a weak and negative correlation is found between share price and interest rates. A strong and negative correlation exists between inflationary rate and share price. No causal relationship is indicated by Granger causality test in the short run. The paper recommends that in the pursuit of the millennium development goals and the realization of transformation agenda of the federal government of Nigeria, the planners of the economy should take the interactions of these macroeconomic variables and share prices into consideration in setting fiscal, monetary and other economic and investment policies
Keywords: Brewery, Causalities, Macroeconomics, Regression, Share Prices