This study investigates the impact of economic variable changes on the performance of Nigerian manufacturing firms. Using data from selected firms and the Central Bank of Nigeria, from 2004-2022, the researchers examined the relationship between the average consumer price index (CPI), average exchange rate, and earnings per share (EPS). Results show a significant positive relationship between CPI and EPS, suggesting manufacturers adjust prices to offset increased production costs, thus boosting profit margins. Conversely, the average exchange rate showed no significant relationship with EPS. The study concludes that while manufacturers absorb exchange rate fluctuations, they ultimately pass on the burden to consumers through price adjustments. The authors recommend that the Nigerian government should actively support local firms to reduce import dependency and foster economic growth.

Sunday Egbe Idaka, Gabriel Femi Goodwill, Fabian Ajijias Okwajie, Andortan Solomon Andortan