Factors affecting Forex external

Factors affecting Forex external:

1st Basic factors:

- All these events affect the basic economic and fiscal policy of the Government concerned.

- It's basic economic policies followed by the government on inflation, balance of payments position, unemployment, capacity utilization, trends in imports and exports, etc.

2nd Political and psychological factors
3rd Technical factors
- Capital Movement
- Relative inflation rates
- Exchange rate policy and intervention
- Interest rates

5th Speculation:

- In anticipation of market participants many times is the primary cause of exchange rate movements.

- Those speculators to predict events, even before the actual data is out and is positioned to take advantage when the actual data confirms the anticipations.