ABSTRACT
This paper examines the effects of Naira devaluation on trade balance in Nigeria. Annual time’s series data over the period ranging from 1986 to 2017 was used with Engle-Granger cointegration test used to test the existence of a long run relationship. The results of the estimation show that Naira devaluation had no significant influence on change in trade balance in the long-run in Nigeria in the periods under study. The result also suggests that Naira devaluation exerts no significant impact on trade balance in Nigeria over the study periods. The paper recommend that Nigerian currency should be allowed to depreciate freely through market forces and efficient money market system, official devaluation should be discouraged.
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