Saturday, September 5, 2009

Domestic Economic and political conditions affect on exchange rates

the market for a national currency is of course influenced by domestic conditions. Wars, revolutions,the death of a major political leader, inflation, recession, and labor strikes have all been observed to have adverse effects on the currency of a nation experiencing these problems. On the other hand, signs of rapid economic growth,industrial development, improving government finances, rising stock and bond prices, and successful economic policies to control inflation and unemployment usually lead to a stronger currency in the exchange markets.

No comments: