Corona Virus (COVID-19) Pandemic and Nigerian Financial Market
7 Pages Posted: 24 Jul 2020 Last revised: 8 Sep 2020
Date Written: June 10, 2020
The study empirically investigates the effect of the Coronavirus outbreak on the performance and effectiveness of the Nigerian money market, capital market, and foreign exchange market. TO achieve this objective, the study made use of time-series data for 120 working days after the first COVID-19 confirmed case in Nigeria and used both exploratory and multiple regression analysis to evaluate the effect of COVID-19 on the Nigerian financial market. Open buy back rate (OBRR), All Share Index Volume (ASIV) and Parallel Foreign Exchange Rate (PFXR) were used as variables for money market, capital market and foreign exchange market respectively. Results from the analysis show that COVID-19 cases is inversely related to the interbank money market rate and the All Share Index Volume of the capital market, but directly related to the foreign exchange rate. The study concludes that COVID-19 pandemic significantly affect the Nigerian financial market. Therefore, it was recommended that the Federal Government should take preventive steps against financial challenges resulting from health risk. This can be done by taking proactive action against diseases that may affect the country’s financial system in order to ensure stability in the performance of our financial market.
Keywords: COVID, Financial Market, Money Market, Capital Market, Foreign Exchange Market
JEL Classification: G1, D01, I1
Suggested Citation: Suggested Citation