Exchange rates for currencies fluctuate primarily due to supply and demand for the currency for each nation. The main factors behind the supply and demand for a particular currency are the political stability of a nation, its economic stability and the interest level investors have in holding a country's currency.Know More
As a nation becomes more politically stable, its money supply is less likely to experience disruptions, continuing to maintain its value. This makes it safe to hold on to the currency, which reduces market volatility in the currency. Eventually, demand rises for the stable currency, which leads to a rise in the price of the currency. If the political situation is unstable, however, demand for the currency falls while the supply for it raises as investors disinvest in the currency. This causes the currency to fluctuate by falling in price.
Economic stability and strength has much of the same effect on the price fluctuation of currency. As long as an economy is achieving high production rates and low unemployment, there is more demand for the currency, causing investors to purchase the currency as a safe haven to hold their money in. This leads to a shortage of the supply of the currency, eventually raising its price. When there is inflation, however, and high unemployment, the demand falls and supply rises, lowering the value of the currency.Learn more about Currency & Conversions
The value of currencies fluctuates throughout the course of a trading day. Therefore, the currency exchange rate changes on a daily basis. A currency’s exchange rate compares its value against another currency.Full Answer >
Inflation rates, interest rates, political stability and economic performance are some of the key factors that affect foreign currency exchange rates. These factors influence the variations and fluctuations in foreign exchange rates and are the reasons for their volatility.Full Answer >
Historical currency exchange rate charts are available from a number of currency information websites such as OANDA, Currencies Direct and OzForex. The exact process for viewing the information depends on the design of the particular Web page offering the information.Full Answer >
Two reliable sources for finding currency exchange rates in the United Arab Emirates, or UAE, are the XE and OANDA websites. Both sites allow users to see up-to-date exchange rates for various currencies against the UAE's emirati dirham. The UAE's currency has the symbol AED, notes XE.Full Answer >