IMPACT OF INFLATION AND EXCHANGE RATES ON FINANCIAL PERFORMANCE OF CONSUMER GOODS SECTOR OF THE CAPITAL MARKET IN NIGERIA

Abstract

This study assesses the impact of inflation and exchange rate on the financial performance of consumer goods sector of Capital market in Nigeria. The study uses purposive sampling technique and elimination method to determine the considered consumer goods companies in Nigeria Capital market over a period of 2012-2023 and analyzed the impact of inflation and exchange rate on the financial performance of these companies measured by earnings per share as the indicator. Regression analysis was used to analyze the data. The result specifically shows that there is inverse relationship between fluctuations in inflation rate, exchange rate and the financial performance of consumer goods sector in the capital market in Nigeria.. The study recommends implementation of price stability programme to regulate inflation and adjustment of exchange rate stabilization policy to reduce import costs and improve the bottom line profitability of the consumer goods companies in Nigeria Capital market.