 |
Countries might benefit in International Trade if the value of their currency is manipulated. The Exchange Rate is artificially kept low by the national bank engaging in open market operations. For example China has been successfully doing that for many years now. By keeping the value of its currency low, it is easier for the nation to import as well as export good in various foreign markets, especially the United States of America.
As an effective Exchange Rate Calculator would have calculated, by keeping the value of a nation’s currency low, all forms of financial transactions, be it money transfer or exchanging currency for foreign travel, if the value of the domestic currency is deliberately kept low, then it becomes easier to exchange in foreign transactions. This is however now a preferred method recommended by economists since deliberately keeping a nation’s rate of exchange low might lead to financial complications.
