Answer to Question #81874 in Economics for Yemi Ajayi

Question

Suppose that at a given moment the central Bank of Nigeria begins to worry publicly more than previously about inflation, while the US federal reserve does not but the actual Nigeria Monetary posture does change. What will be the effect, if any of these increase Central Bank of Nigeria concern about inflation on dollar/Naira spot rate?

Answer 1

If the central Bank of Nigeria begins to worry publicly more than previously about inflation, while the US federal reserve does not, then dollar/Naira spot rate will decrease.