IIARD International Institute of Academic Research and Development

INTERNATIONAL JOURNAL OF COMPUTER SCIENCE AND MATHEMATICAL THEORY (IJCSMT )

E-ISSN 2545-5699
P-ISSN 2695-1924
VOL. 10 NO. 5 2024
DOI: 10.56201/ijcsmt.v10.no5.2024.pg100.113

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Intervention Modeling of the 2016 Economic Recession Using Turkish Lira/Nigerian Naira Exchange Rates

Ipaa Clement Tambari, Ette Harrison Etuk & Isaac Didi Essi

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Abstract

This research work examined the exchange rate of a comparative value of the Nigeria Naira with respect to Turkish Lira to the economic recessions of 2016 from 1 January to 31 December 2016 utilizing Box and Tiao's intervention analysis approach (1975). The Eview 10 package was used to evaluate the data. Time plot of daily exchange rate of Turkish Lira/Nigeria Naira shows horizontal trend then a vertical abrupt increase on 23 June 2016which prompted an intervention modeling. The pre-intervention series are adjudged stationary using ADF unit root test at first difference. Post-intervention forecast were obtained. The pre-intervention dataset also indicated an upward movement showing that the series is not stationary. At a significance level of less than 5%, the pre-intervention series was shown to be stationary by the Augmented Dickey Fuller unit root test. Plotting the stationeries data's correlogram revealed that ARIMA( 7,1,7) was suggestive. The accompanying observations and the intervention forecasts are in close agreement. The intervention impact is therefore noteworthy. The daily Turkish lira/Nigerian Naira from 1stJanuary to 31 December 2016, the pre-intervention series are adjudged stationary using ADF unit root test at first difference. Post-intervention forecast was obtained. This produced very close relationship between post-intervention forecast and the real data. This intervention model is hoped to be a basis for managing recession and help to proffer solution to exchange rates issue when it arises

keywords:

Intervention, Modeling, Economic Recession, Turkish Lira/Nigerian Naira.

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References:

Box, G. E. P., & Tiao, G. C. (1975). Intervention Analysis with Applications to Economic and
Environmental Problems. Journal of the American Statistical Association.
Central Bank of Nigeria (CBN). (2022).Statistical Bulletin.
Exchange Rate UK. (2010). Historical Exchange Rates.
Nweze, O. (2021). The Challenges Facing the Naira: An Economic Perspective*.
Onasanya, O. S., & Adeniji, A. A. (2013). Exchange rate forecasting theory and models.
Suhurtono, (2007). Intervention Analysis in Time Series Data: Applications and Implications.
World Bank. (2017).Nigeria Economic Report: Recession and Recovery.
World Bank. (2021).Nigeria Economic Update: COVID-19 and the Economy.

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