国际金融

International Balance of Payments AnalysisB13120219 姬茜茜经济学2班Abstract:Factors that affect exchange rate movements are various. Generally speaking, the change of a country's economic strength and the choice of macroeconomic policy are the fundamental reasons for the long-term development trend of exchange rate. We often see in the foreign exchange market, the market is very concerned about the various countries of the economic data, such as the gross national economic output value, consumer price index, interest rate changes, etc..Key words: rate; gross national economic output value;interest rate changesIn the foreign exchange market, we should clearly recognize and understand the relationship and effects of all kinds of data, index and exchange rate changes, in order to further find the law of exchange rate changes, active in the foreign exchange market for speculative investment timing and guard against foreign exchange risk. There are many factors that affect exchange rate movements in economic activities, and are listed as follows:First, the international balance of payments. The international balance of payments is the dominant factor in determining the exchange rate. The balance of payments is the sum of all kinds of income and expenditure in a country's foreign economic activities. Under normal circumstances, the balance of payments deficit indicates that foreign exchange is in short supply. In the floating exchange rate system, the market supply and demand determines the exchange rate changes, so the balance of payments deficit will cause the devaluation of the currency, foreign currency appreciation, that is, the foreign exchange rate rise. On the contrary, the balance of payments surplus has caused the exchange rate to drop.Two, national income. Generally speaking, the increase in national income, to promote the level of consumption, the corresponding increase in the demand for local currency. If the money supply is the same, the additional demand for local currency will increase the value of the local currency, resulting in foreign currency devaluation. Of course, the change in national income caused by the exchange rate is down or up, depends on the reasons for the changes in national income. If the national income is increased by increasing the supply of goods, the purchasing power of the country's currency can be strengthened in a longer period of time, and the foreign exchange rate will fall. If the national income was increased due to the expansion of government spending or the expansion of aggregate demand, supply in the same case, excess demand must through the expansion of imports to meet, which makes the demand for foreign exchange, foreign exchange rate will rise.Three, the level of inflation. The high and low inflation rate is the basis of exchange rate change. If a country's currency is too much, the amount of money in circulation exceeds the actual demand in the process of commodity circulation, it will cause inflation. Inflation makes a country's currency in the domestic purchasing power decline, so that the devaluation of the currency devaluation, in other conditions unchanged, the devaluation of the currency against the inside, will inevitably cause external depreciation. Because the exchange rate is compared to thevalue of the two countries, currency too many countries and reduce the value of the monetary unit represents, therefore in the conversion of currency into foreign currency, it is necessary to pay than the original of the country's currency.Four, money supply money supply is the most important factor to determine the value of money and the purchasing power of money. If the domestic money supply is reduced, the local currency is more valuable because of the scarcity. Usually money supply reduction accompanies with the monetary tightening, credit crunch, resulting in total demand, the decline in output and employment, prices are falling, so as to improve the value of the local currency, the exchange rate will accordingly fell. If the money supply increases, excess money in the form of inflation out, domestic commodity prices rise, decline in purchasing power, which will promote relatively cheap foreign goods imported in large quantities, exchange rate will rise.Five, fiscal revenue and expenditure of a country's financial revenue and expenditure has a great impact on the international balance of payments. The expansion of the fiscal deficit will increase aggregate demand, often resulting in the balance of payments deficit and inflation, the result of a decline in purchasing power of the currency, the increase in foreign exchange demand, and thus promote the exchange rate rise. Of course, if the fiscal deficit is expanded, the monetary policy in order to strictly control the amount of money, raise interest rates, but will attract foreign capital inflows, so that the currency appreciation, the foreign exchange rate fell.Six, interest rates under certain conditions on the short-term impact of the exchange rate. The impact of interest rate on exchange rate is caused by the difference in interest rates between different countries, especially in the short term capital flows. In general, if the interest rate difference between the two countries is greater than the forward of the two countries, the spot exchange rate differences, funds will by countries with lower interest rates to flow to countries with higher interest rates, which is conducive to countries with high rates of international balance of payments. Should pay attention to is, interest rates on the exchange rate although certain effect, but from a basic factor to determine the exchange rate fluctuation, its role is limited, it just under certain conditions, the changes in the exchange rate temporarily.Seven, the exchange rate policy and the intervention to the market, to a certain extent, affect the exchange rate of exchange rate policy and the intervention to the market. In the floating exchange rate system. Central banks are trying to coordinate between the countries in the monetary policy and exchange rate policy, trying to through affect the foreign exchange market supply and demand to support their currencies, central bank in the foreign exchange market, the main means of is adjusting its monetary policy, through the interest rate changes affect the exchange rate; direct intervention in the foreign exchange market; implementation of exchange controls on capital flows.。