Exchange rates

HideShow resource information

Exchange rates

  • Exchange Rates: The value of one currency expressed in terms of another.

What are the influences on exchange rate:

  • Interest rates
  • Inflation
  • Economic growth
  • Public debt
  • Speculation
  • Shocks
  • Balance of payments

How can the government effect interest rates?

  • Keep debt down
  • Alter interest rates, the higher the interest rates, the stronger the currency
  • Encourage exports

Real Exchange rate:

  • The exchange rate against another currency adjusted for…


No comments have yet been made

Similar Economics & Business Studies resources:

See all Economics & Business Studies resources »See all Globalisation and trade resources »