A STUDY ON RELATIONSHIP BETWEEN FOREIGN EXCHANGE RATE AND FDI IN BRICS NATIONS

Abstract

Brics Nations are the emerging economies in the world. These five countries have about 56.5 percent population of the World. This study was conducted to examine the impact of exchange rate on foreign direct investment in Brics Nations. Exchange rates have main role that affect the macroeconomics performance of any leading country. The objective of this research was to investigate whether uncertainty or fluctuations in exchange rate affects the macroeconomic in BRICS NATIONS. This Study was based on secondary and time series data. For this purpose 06 years data of Exchange rate and FDI for the period of 2010 to 2015 was used and was collected from the website of World Trade Organization, International Trade Statics, 2015. The tests of Correlation regression, co integration analysis were applied through Microsoft Office Excel and E-views software to check the relationship between Exchange rate and FDI. The correlation results showed that there is positive significant relationship between Exchange rate and Foreign Direct Investment while in regression analysis the value of R-square which shows that the independent variable Exchange has 67% impact on dependent variable Foreign Direct Investment and research model is accurate. This research will help the mangers, related organization and future researchers to make or revise the further economic decisions. The goal of the research was to investigate the impact of exchange rate volatility on FDI into BRICS Nations with very specific focus on annually data for the period between 2010-2015.