1. Long-term influencing factors: balance of payments, inflation, interest rate level, exchange rate policy, etc. Among them, a country's balance of payments plays a long-term decisive role in exchange rate changes, and the balance of payments will directly affect the supply and demand relationship in the foreign exchange market;
2. Short-term influencing factors: speculative activities and the release of major economic and political events or economic data. Before, during and after major economic and political events or economic data, the market will expect the trend of events, thus affecting the exchange rate. The exchange rate change is the result of multiple factors, which will play a role at the same time, and individual factors may also play a decisive role; Many factors may have synergistic effects or cancel each other out.
For example, on June 5, 20 15, 15, the Swiss national bank suddenly announced that it would cancel its peg to the euro since September of 20 1 1 and maintain the lower limit of 1.20. This change in exchange rate policy caused the Swiss franc to soar against other currencies, with the highest increase of 40% to 1. Another example is the world-famous economic events such as the Fed's interest rate hike. When employment in the United States continues to improve and inflation rises, the Federal Reserve will raise the target range of the federal funds rate to prevent the economy from overheating. When the Federal Reserve Open Market Committee announces the decision to raise interest rates, the market will react instantly, and there will be exchange rate changes such as the strengthening of the US dollar index and the weakening of non-US currencies against the US dollar. For another example, the publication of major economic data will also have an impact on the exchange rate: a country's PMI data is usually regarded as a leading indicator of a country's economic trend, and when similar economic data are published, the foreign exchange market will also change accordingly. When the published PMI value is worse than expected, the country's currency will weaken accordingly.
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