Citizens, remembering crisis of 1998 and in general, not especially trusting the domestic ruble inclined to devaluation, prefer to store the savings in currency. Someone manages even to increase the capital, speculating in differences in exchange rates. Really, it would be quite tempting to know on what factors the rate fluctuation depends.
Instruction
1. Often mass actions of people have the greatest influence on change of an internal rate of any given currency. For example, hearing that dollar exchange rate will decrease soon can lead to the fact that hundreds and thousands of people will go to exchange offices where quickly will begin to hand over dollars, thereby increasing their quantity in the bank environment, and it steadily will lead to decline in the rate. Communication between quantity of currency in the address and its price (course) is inversely proportional. The defitsitny any given currency at the moment, the higher it a course. Therefore if you hear that people massively hand over, for example, euro, think, maybe, it is worth not to following all and to wait the panic moment? On the other hand, if people massively buy currency per its growth, that is the sense to appear in the forefront, and actions of people will really lead to the fact that exchange rate will grow. Other question – from where will undertake such unity of people? You watch news, usually most of people perceive any hint on rate fluctuations of currency as an appeal to actions.
2. If to consider forecasting of exchange rate in the long-term period, it is necessary to be guided by the macroeconomic processes happening in the country which exchange rate interests you. The proximity of a default, naturally, will lead to depreciation of currency, and increase in export of goods – to growth of exchange rate of the country about which it is. It is also possible to approve in attention and overall balance of the movement of currency from the country and to the country. This information is published by the Central banks and statistical bureaus of single countries.
3. Unfortunately, the majority of transactions between the countries influence exchange rate still before they are carried out. As well actions of investors are reflected in a course how they transferred the assets to currency, that is if to speak in images, "put in it trust". That is growth of a course, at least, is reflection of someone's actions, and it is not an element of forecasting any more, and just statement of the facts.