The main aim of this study is to find out the effect of exchange rate fluctuation on the firm profitability of selected quoted conglomerates in Nigeria. Specifically, it investigated the extent to which exchange rate fluctuation affect return on capital employed. In pursuit of the objectives of this study, two hypotheses were formulated and tested using secondary data obtained from the firms’ annual report and CBN annual statistical bulletin. Data were analyzed using multiple regression analytical estimation technique with the aid of SPSSv21 which was used in determining the effect of exchange rate fluctuation on firm profitability. The findings confirmed that the two hypothesis tested were insignificant. Therefore, the researcher recommends that Government should uphold the restriction policy on the importation of similar products manufactured in Nigeria. If this is religiously pursued, it will create and open more markets for the locally manufactured goods to thrive. Also Government should make policy that aims at naira appreciation against foreign exchange which will greatly help reduce the cost of production in the manufacturing sector.
Adamu, N., Zubairu, I.K., Ibrahim, Y.M.,& Ibrahim, A.M. (2011). Evaluating the impact of
product diversification on financial performance of selected Nigerian construction firms. Journal of Construction in Developing Countries,16(2), 91- 114.
Adeniran, J.O., Yusuf, S.A.,& Adeyemi, O.A. (2014). The impact of exchange rate fluctuation on the Nigerian economic growth: An empirical investigation. International
Journal of Academic Research in Business and Social Sciences, 4(8), 224-233.
Aghion, P, Bacchetta, P, Ranciere, R & Rogoff, K (2009) Exchange rate volatility and
productivity growth: the role of financial development. Journal of monetary economics 56 (4) 494-513
Ahmed, L (2015) The effect of foreign exchange exposure on the financial performance of
commercial banks in Kenya. International journal of sciences and research publications, vol.5(11)115-150
Akpan, E.O., & Atan, A.J (2012). Effects of exchange rate movements on economic growth
in Nigeria. CBN Journal of Applied Statistics, 2(2), 1-14.
Akpan, P.L (2008). Foreign exchange market and economic growth in an emerging petroleum based economy: Evidence from Nigeria(1970-2003).African Economic and
Business Review, 6(2), 46 - 58.
Aliyu, S.R.U (2011). Impact of oil price shock and exchange volatility on economic growth
in Nigeria: An empirical investigation. Research Journal of International Studies, 1(1), 103-120.
Arinze, A.C., Osang, T., & Slottje, D.J. (2000). Exchange ratevolatility and foreign
trade: Evidence from thirteen LDCs. Journal of Business and Economic Statistics,18(1),10-17.
Asher, O.J. (2012). The impact of exchange rate fluctuation on the Nigerian economic growth
(1980-2010).Unpublished B.Scthesis of Caritas University, Enugu State, Nigeria.
Azeez, B.A., Kolopo, F.T. & Ajayi, L.B. (2012). Effect of exchange rate volatility on macroeconomic performance in Nigeria. Interdisciplinary Journal of Contemporary
Research in Business. 4(1), 149–155.
Barkoulas, J.T., Baum, C.,& Caglayan, M. (2000). Exchange rate effect on thevolume and
variability of trade flows. Journal on International Money and Finance,21(3),481-496.
Dada, E.A & Oyeranti, O.A. (2012). Exchange rate and macroeconomic aggregates in Nigeria. Journal of Economic and Sustainable Development, 3(2), 93-101.
Dickson, O.O. (2012). Exchange rate volatility and economic growth in Nigeria. Mediterranean
Journal of Social Sciences, 3(3), 23-38.
Dmitri, R. (2003). The real exchange rate and the Balassa- Samuelson Hypothesis: An
appraisal of Israel’s case since 1986.Jerusalem,Research Department of Bank of Israel.P.1-35. Retrieved from http://www.bankisrael.gov.il
Gounopoulos, D., Molyneux, P., Staikouras, S.K, Wilson, J.O. & Gang, Z. (2012). Exchange rate risk and equity performance of financial intermediaries: Evidence from
an international sample. International Review of Financial Analysis, 29(2013), 271-282.
Graham, J.R., Campbell, R.H., & Rajgopal, S. (2005). The economic implications of corporate financial reporting. Journal of Accounting and Economics,40(3), 3–73.
Jhingan, M.L.(2002). Macroeconomic Theory, 10th Edition. New Delhi, Vrinda Publications
Ltd.
Kanagaraj, A.&Sikarwar, E. (2011). A Firm Level Analysis of the Exchange Rate exposure of
Indian Firms. Journal of Applied Finance& Banking,1(4),163- 184.
Katarzyna,T., & Magdalena, K. (2014). Analysis of factors affecting fluctuations in the exchange rate of Polish zloty against euro. Human capitalwithout borders: Knowledge and learning for quality of life. Portoroz, Slovenia. P. 889-898.
Lindo, D. K. (2008), Assets management is your job. In Super Vision.69 (1),14- 18.
Magda, K. (2004). Exchange rate fluctuations and economic activity in developing countries: theory and evidence. Journal of Economic Development, 29(1),85-108.
Mordi, C.N. (2006). Challenges of exchange rate volatility in economic management in Nigeria. Central Bank of Nigeria Bullion,30(3), 24-33.
Morley, S. A
In-Text Citation: (Okika Christian, Francis, & Greg, 2018)
To Cite this Article: Okika Christian, E. M., Francis, N. P. ., & Greg, O. O. (2018). Effect of Exchange Rate Fluctuation on Firm Profitability: Evidence from Selected Quoted Conglomerates in Nigeria. International Journal of Academic Research in Business and Social Sciences, 8(12), 1073–1090.
Copyright: © 2018 The Author(s)
Published by Human Resource Management Academic Research Society (www.hrmars.com)
This article is published under the Creative Commons Attribution (CC BY 4.0) license. Anyone may reproduce, distribute, translate and create derivative works of this article (for both commercial and non-commercial purposes), subject to full attribution to the original publication and authors. The full terms of this license may be seen at: http://creativecommons.org/licences/by/4.0/legalcode