Firms make several financial and strategic decisions which are usually moderated by the workings of operating business environment. Understanding how the fluctuations of these economic variables moderate variations in firms’ financial performance is crucial and germane to meeting cooperate goals and objectives. Insensitive to how these economic variables affect financial performance may lead to wrong decisions and may have implications on performance. Consequently, this study investigated the impact of economic characteristics of a firm’s operating environment represented by; Government Expenditure, Inflation, Interest rate and Exchange rate fluctuations on financial performance expressed by earnings per share (EPS), Return on Equity (ROE), Return on Asset (ROA), and Tobin’s Q (TQ) of Nigeria manufacturing firms.The study adopted ex-post facto research design. Stratified and random sampling methods were used to select 31 out of the 45 manufacturing firms listed on
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