Abstract
This work examines the effect of inflation rate on the performance of manufacturing and agricultural sectors. Yearly data were used from 1975 to 2020. The Auto Regressive Distributed Lag (ARDL) was used to analyse the data, and the yearly data were sourced from Word Development indicator (WDI) and Central Bank of Nigerian (CBN) Statistical Bulletin. This research work considers inflation rate, credit to private sector (PRIVATECREDIT), manufacturing capacity utilization (MCAPUTIL), foreign direct investment (FDI), credit to agriculture (AGRICCREDIT), agriculture equipment (AGRICEQUIP)and Exchange rate (EXCH) as independent variables on agricultural output and MVA. Based on ARDL approach, based on ARDL approach, test was carried out on each dependent variable and the independent variable to check the long and short run regression findings for the coefficient of the lagged values of the dependent and independent variables. Some diagnostic test like the serial correlation test, heteroskedasticity test, and stability test were also carried out on the variables. From the results obtained, agricultural equipment, and exchange rate are statistically significance to agricultural output. Foreign direct investment, and inflation rate has statistical significance on manufacturing output. It is therefore recommended that Government should always check on the increase of inflation rate and how it is affecting the performance of the manufacturing sector and agricultural sectors so as to provide necessary solution in case if any problem arises. There should be an encouragement of foreign investment into the manufacturing sector in the country
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