7. Indirect intervention Suppose the Fed wants to strengthen the dollar by using indirect intervention. To accomplish this goal, the Fed could warn speculators that it Intends to the value of the dollar soon. Anticipating the increase in value, speculators may try to exchange other currencies for dollars, thereby the supply of other currencies in the foreign exchange market. All else equal this would the value of the dollar relative to the other currencies,6. Direct Intervention as a policy tool Suppose that the U.5. Federal Reserve wishes to influence the value of the dollar to decrease inflation. If the Fed uses direct intervention to achieve this goal, It will seek to the dollar. In doing so, this direct intervention may very well unemployment since demand for domestically produced goods may