Comments on: how does Currency get stronger? http://www.myylt.com/2010/06/02/how-does-currency-get-stronger/ Discussion of Forex Trading and Currency Trading Thu, 24 May 2012 02:23:10 +0000 http://wordpress.org/?v=2.3.3 By: Smitty http://www.myylt.com/2010/06/02/how-does-currency-get-stronger/#comment-26243 Smitty Tue, 30 Nov 1999 00:00:00 +0000 http://www.myylt.com/2010/06/02/how-does-currency-get-stronger/#comment-26243 It generally depends upon productivity, monetary policy, and public debt. The more debt a country takes on, the lower their currency value compared to other countries. If one country's currency loses value, all the others gain value compared to them (if they are a trading partner). The looser the monetary policy, the lower the strength of the currency. In other words, if a country prints money to stimulate growth, it's currency declines. However, if it raise interest rates, it's currency strengthens. If a country improves productivity, it's currency will strengthen. It generally depends upon productivity, monetary policy, and public debt. The more debt a country takes on, the lower their currency value compared to other countries. If one country’s currency loses value, all the others gain value compared to them (if they are a trading partner).

The looser the monetary policy, the lower the strength of the currency. In other words, if a country prints money to stimulate growth, it’s currency declines. However, if it raise interest rates, it’s currency strengthens.

If a country improves productivity, it’s currency will strengthen.

]]> By: 1901 http://www.myylt.com/2010/06/02/how-does-currency-get-stronger/#comment-26244 1901 Tue, 30 Nov 1999 00:00:00 +0000 http://www.myylt.com/2010/06/02/how-does-currency-get-stronger/#comment-26244 Currencies get stronger or weaker comparing them to other currencies. When a country goes thru inflation, its currency value decreases (nationally and globally) because there are more bills and coins but no more goods in the country. On the other hand, when a country is doing good (high production, low or none external debt) it's currency value increases. PS: I'm trying to explain this in simple words. There are many, many issues that come to mind when you discuss currency value or inflation. Currencies get stronger or weaker comparing them to other currencies. When a country goes thru inflation, its currency value decreases (nationally and globally) because there are more bills and coins but no more goods in the country. On the other hand, when a country is doing good (high production, low or none external debt) it’s currency value increases.

PS: I’m trying to explain this in simple words. There are many, many issues that come to mind when you discuss currency value or inflation.

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