ABSTRACT

The study investigated the effect of exchange rate fluctuations on the volume of imports in Nigeria for the period 1981-2018 with specific objectives namely; to determine the effect of exchange ratefluctuations on the volume ofimport in Nigeria, to determine the effect ofinflation on the volume ofimport in Nigeria, to determine ifmoney supply has any effect on the volume of import in Nigeria and to determine if oil revenue has any effect on the volume of import in Nigeria. The specified model was estimated using the Autoregressive Distributive lag Model to determine the level of impact that one variable has on the other. While E-views 10 statistical software was employed in computing the result, time series data were obtainedfrom World Bank national accounts data and OECD National Accounts data files and the study established that Inflation rate (1NFR) has a negative relationship with volume ofimports in the current year, 1st lag and 2nd lag in the short run and also in the long run period, Official Exchange Rate Volatility (OEXCRVT) had a negative relationship with Volume ofImport (IMPVID) in the current year in the short run and also in the long run and statistically significant but wasfound to have a strong influence on IMPVID in the 1st lag, 2nd lag and 3‘ lag why Broad Money Supply (M2) had a strong positive relationship with IMPVID in the current year but was statistically insignificant at 5% level ofsignificance. In the Is' lag in the short run, M2 had a strong influence on the volume of imports and the study recommended that the government should put in place measures to reduce the impact offluctuations in the international trade through the volatile crude oil prices on Nigeria’s economic conditions. This can be achieved by reducing the dependence of the economy not only on crude oil exports by diversifying the productive base of the economy through non-oil exports and also should stimulate the productive capacity of the economy, especially the agricultural sector to increase aggregate supply of basic foodproducts and meet the needs of the industrial sectors so that prices ofgoods and services cotdd come down and consequently boost economic growth in the country