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1) Affect the current price of goods domestically.
2) Encourageimportsor exports, depending on the goods.
3) Stimulate the local economy
4) Stimulate the economy of a friendly emerging nation.
There are times where just the news of a change is enough to effect a significant outcome in the exchange rate. But other times, direct buying/selling or trading of currency notes(or currency equivalent like bonds and otherpromissorynotes)
What else can I help you with?
Advantages of a fixed rate of exchange?
A fixed exchange rate system is one where the value of the exchange rate is fixed to another currency. This means that the government have to intervene in the foreign exchange market to maintain the fixed rate. The equilibrium exchange rate may be either above or below the fixed rate. In Figure 1 below, the equilibrium is above the fixed rate. There is a shortage of the national currency at the fixed rate. This would normally force the equilibrium exchange rate upwards, but the rate is fixed and so cannot be allowed to move. To keep the exchange rate at the fixed rate the government will need to intervene. They will need to sell their own currency from their foreign exchange reserves and buy overseas currencies instead. This has the effect of shifting the supply curve to S2 and as a result, their foreign currency holdings will rise.
What are the differences between foreign exchange market and equity market?
Foreign exchange (forex) is the global market of currency (money) , equity market (stock market) is the global market of shares (small pieces of large companies)
What is the role of RBI in the foreign exchange market?
Just link to this site and ull get ur answer http://www.slideshare.net/rajeevj/foreign-exchange-market-presentation
Why do nations buy foreign currency?
Nations buy foreign currency primarily to stabilize their own currency's value, manage exchange rates, and influence trade balances. By accumulating foreign reserves, they can intervene in the foreign exchange market to prevent excessive volatility or depreciation of their currency. Additionally, holding foreign currency enables countries to facilitate international trade and investments, ensuring they can pay for imports and meet foreign obligations.
What determines supply and demand in the foreign-exchange market?
Supply and demand in the foreign-exchange market are determined by changes in many market variables, including relative price levels, real interest rates, productivity, product preferences, and perceptions of economic stability.
What is difference between money market and foreign exchange market?
Foreign exchange market is a market where foreign exchange currency problems are resolved in international trade. Where as Money market is for the lending and borrowing of short term loans.
Advantages of a fixed rate of exchange?
A fixed exchange rate system is one where the value of the exchange rate is fixed to another currency. This means that the government have to intervene in the foreign exchange market to maintain the fixed rate. The equilibrium exchange rate may be either above or below the fixed rate. In Figure 1 below, the equilibrium is above the fixed rate. There is a shortage of the national currency at the fixed rate. This would normally force the equilibrium exchange rate upwards, but the rate is fixed and so cannot be allowed to move. To keep the exchange rate at the fixed rate the government will need to intervene. They will need to sell their own currency from their foreign exchange reserves and buy overseas currencies instead. This has the effect of shifting the supply curve to S2 and as a result, their foreign currency holdings will rise.
What is foreign market manipulation?
manipulate in the securities of the FOREX(foreign exchange market)..
How to name Forex market in other words?
currency exchange Fx market Foreign exchange market
What is a fx trader?
"Fx trader, or Foreign exchange market, is a global financial market to show the current foreign exchange on currencies. It determines the currency exchange rates."
What role has the Uganda Government played in the Foreign exchange market?
The Uganda government has played a significant role in the foreign exchange market by implementing policies to stabilize the Ugandan shilling and manage inflation. Through the Bank of Uganda, the government intervenes in the currency market to control exchange rate fluctuations and ensure liquidity. Additionally, it promotes foreign investment and trade, which impacts currency demand and supply. Overall, these actions aim to create a more stable economic environment conducive to growth.
What are the foreign exchange market instruments?
what are the FOREX market instrument?
What are the differences between foreign exchange market and equity market?
Foreign exchange (forex) is the global market of currency (money) , equity market (stock market) is the global market of shares (small pieces of large companies)
What is the role of RBI in the foreign exchange market?
Just link to this site and ull get ur answer http://www.slideshare.net/rajeevj/foreign-exchange-market-presentation
What are the main institution of the foreign exchange market?
I think that there is no any main institute of foreign exchange market. how ever for informationn about t forex visitwww.forexarticale.blogspot.com
The word Forex is short for?
Forex is a contraction of 'foreign exchange,' which refers to the global currency exchange market.
What determines supply and demand in the foreign-exchange market?
Supply and demand in the foreign-exchange market are determined by changes in many market variables, including relative price levels, real interest rates, productivity, product preferences, and perceptions of economic stability.
