Factors that Affect Forex Rates

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Factors that Affect Foreign Exchange
Rates
http//www.forexrates.today/blog/category/foreign-
exchange/
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Forex Trading
Forex rate and Forex trading involves trading
foreign currencies against each other as some
strengthen and others weaken. It's an advanced
strategy that requires upfront research and some
understanding of how currencies work.
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Forex Rates

• Forex rates through which a countrys relative
  of economic health is determined.
• The exchange rate is defined as "the rate at
  which one country's currency may be converted
  into another."
• when sending or receiving money internationally,
  it is important to understand what determines
  exchange rates.

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What are factors affecting forex rates?
Inflation Rates A country with a frequently
lower inflation rate exposition a rising currency
value when a country with higher inflation
generally sees deflate in its currency and is
usually associated by higher interest rates Bank
Rates Increases in interest rates cause a
country's currency to appreciate because higher
interest rates provide higher rates to lenders,
thereby attracting more foreign capital, which
causes a rise in exchange rates, Live forex rates
is affecting directly or indirectly
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Countrys Current Account / Balance of Payments
and Government Debt

A countrys current account reflects balance of
trade and earnings on foreign investment Governme
nt debt is public debt or national debt owned by
the central government. A country with government
debt is less likely to acquire foreign capital,
leading to inflation.
.
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Supplementary Factors Affecting Forex


Terms of TradeThe ratio of export prices to
import prices. A country's terms of trade
improves if its exports prices rise at a greater
rate than its imports prices. Forex rates live is
Also very important and this results in higher
revenue, which causes a higher demand for the
country's currency and an increase in its
currency's value. Political Stability its
PerformanceA country with sound financial and
trade policy does not give any room for
uncertainty in value of its currency.
.
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?
Why forex rates ?

• Forex rates operates 24 hours a day, five days a
  week.
• The greatest liquidity occurs when operational
  hours in multiple time zones overlap.
• Usually forex rates today Spreads and spreads in
  the forex market or in the live forex rate also
  tend to be much less or tighter than the spreads
  applied to other securities such as stocks.
• This makes OTC forex trading one of the most
  cost-effective means of investment trading.

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