The Relationship Between Gross Domestic Product and Exchange Rates in Nigeria: A Quantile Regression Approach

Exchange rate is an important microeconomic variable in the general economic policy making and reform program. This paper modelled Gross domestic product (GDP) and exchange rate at different quantiles using quantile regression (QR). The model was implemented on GDP and exchange rate data obtained from Central Bank of Nigeria (CBN) annual statistical bulletin. The study covers the period from first quarter (Q1), 2019 to second quarter (Q2), 2024. The software used for analysis was STATA version 14.0. The study revealed that GDP and exchange rate were non-stationary and contained unit root at all levels. Exchange rate is significant at 95% and had positive impact on GDP at all quantiles. The study concludes that exchange rate should be handled by experts to avoid decline in the GDP and economy of Nigeria. The study recommends the adoption of good policies to reduce/stabilize exchange rate and boost the performance of GDP in the country.