- April 2014
- Posted By Ninoslav
- 0 Comments
As a part of any country, it is important to you to know the condition of your country’s economy. You should pay interest on currency market and exchange rates which is determined for your own country. Now, while you are talking about Exchange rate, then you should understand that it is used to denote the currency standard of your country in respect of other countries.
As this rate of exchange is closely related to foreign exchange market or trade market, then it is also widely known as Forex or foreign exchange rate. Currencies are exchanged in a specific rate which is determined in trade market or currency market.
Advantages of Exchange rate
Once you start studying with about the Exchange rate, then you can find two different types of rate in exchange. You have the fixed rate in exchange and floating exchange rate. Now, in the fixed one, you can find a direct influence of government of any country. To sustain the rate of currency and to control fluctuation in currency market, government or central bank plays an important role in fixed exchange rate.
Now, if you are looking back to floating exchange rate, then you can find a major influence market on this exchange rate. It is always determined with the changes of international currency market.
It’s all about international market
While one is talking about any kind of Exchange rate, then he or she should understand the international currency in a proper way. It does not matter which kind of currency rate you are talking about. At the end of a day, you need to balance these rates of your country as per the international market. Financial stability of any country is depending on various factors. You need to understand them in a proper way. After that, you can get a clear idea about the economy of your country.