Finance, Forex and Investments

exchange_rate.gif

Summary: ! A high level of demand for a currency will force up its price - the exchange rate. Where supply is equal to demand is the equilibrium exchange rate, as shown in the diagram below. The demand for £ comes from people who are investing in the UK from abroad and so need pounds, or from firms who are buying UK exports. They will need pounds to be able to pay for the goods

Image Dimensions: 310 x 267