Comments on: How are the currency exchange rates set? http://www.currencyexchangemarket.com/blog/how-are-the-currency-exchange-rates-set/ Thu, 17 May 2012 19:41:45 +0000 http://wordpress.org/?v=2.7 hourly 1 By: Itchy1977 http://www.currencyexchangemarket.com/blog/how-are-the-currency-exchange-rates-set/comment-page-1/#comment-1278 Itchy1977 Fri, 03 Apr 2009 15:57:28 +0000 http://www.currencyexchangemarket.com/blog/how-are-the-currency-exchange-rates-set/#comment-1278 No-one sets them - the price is decided on supply and demand. Its the same as anything - if everybody is selling eggs and there are too many eggs for sale, the price goes down and vice versa. Exchange Rate fluctuation is simply the rise and fall in the value of one currency against another. Exchange rates fluctuate every second, and these movements are generally caused by four things. Economic Data, Political Data, Natural Disasters and acts of war. A good example is last week when the Fed announced $1.2 trillion would be pumped into the economy. Investors think creating new money will devalue the dollar, so as investors moved funds from USD to EUR, the dollar got weaker(less in demand) and the Euro got stronger (more in demand). The net result is Sterling exchange rates for the dollar rose, and for the Euro fell. No-one sets them - the price is decided on supply and demand. Its the same as anything - if everybody is selling eggs and there are too many eggs for sale, the price goes down and vice versa.

Exchange Rate fluctuation is simply the rise and fall in the value of one currency against another. Exchange rates fluctuate every second, and these movements are generally caused by four things. Economic Data, Political Data, Natural Disasters and acts of war.

A good example is last week when the Fed announced $1.2 trillion would be pumped into the economy. Investors think creating new money will devalue the dollar, so as investors moved funds from USD to EUR, the dollar got weaker(less in demand) and the Euro got stronger (more in demand). The net result is Sterling exchange rates for the dollar rose, and for the Euro fell.

]]> By: Henry The Dog http://www.currencyexchangemarket.com/blog/how-are-the-currency-exchange-rates-set/comment-page-1/#comment-1277 Henry The Dog Fri, 03 Apr 2009 00:30:14 +0000 http://www.currencyexchangemarket.com/blog/how-are-the-currency-exchange-rates-set/#comment-1277 Currency speculators. Currency speculators.

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