If there is no change in supply of U.S. dollars, but there is an increase in demand, there will be an increase in the rise of exchange rate. Similarly, if there is no change in supply of U.S. dollars, but there is a decrease in demand for it, there will be a drop in exchange rate.
Again, if there is no change in demand related to U.S. dollars, but there is a decrease in supply, there will be a hike in exchange rate. In the same way, if there is no change in demand related to U.S. dollars, but there is an increase in supply of it, there will be a drop in exchange rate.
It can be stated that such forecast is similar if compared with any other type of market.
Links of Previous Main Topic:-
- Definition of Economics
- Economic Problem
- Market Equilibrium
- Employment and Unemployment
- Measuring GDP and Economic Growth
- Economic Growth Macroeconomics
- The Exchange Rate and the Balance of Payments
- The Foreign Exchange Market
Links of Next Macroeconomics Topics:-
- Fundamentals Expectations and Arbitrage
- The Real Exchange Rate
- Exchange Rate Policy
- Flexible Exchange Rate
- Crawling Peg
- Financing International Trade
- Borrowers and Lenders
- Debtors and Creditors
- Is U S Borrowing For Consumption
- Where Is the Exchange Rate
- The Dollar and Carry Trade
- Expenditure Multiplier Know the Keynesian Model