Question
Form a view regarding the future market conditions. Do you think that exchange rates will go up or down in the next 3 to 6
Form a view regarding the future market conditions. Do you think that exchange rates will go up or down in the next 3 to 6 months? Why do you think this? For this, you should first identify the economic factors that influence the foreign exchange rates. Then you should collect and use economic, financial data and recent news which are likely to have an impact on the exchange rates.
Market data must be obtained from credible sources such as World Bank, OECD, IMF databases and respective country's central bank websites.
You are required to analyse these exchange rates based on the economic indicators of the respective countries. The indicators you learn in this subject include relative interest rates, relative inflation rates, relative growth rates, government intervention, and exchange rate expectations. You may also use other factors such as the global health crisis, geo-political climate, and the latest news that may affect the exchange rate. It is a good idea to use
at least 3 of the economic indicators that you have learned in class and one other factor if you want your market view to be strong.
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