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             What Influences Exchange Rates Before we look at the factors and players that influence the exchange rates, we must understand how these rates affect economies. First, exchange rates influence the trading relationship between countries, which is a major concern for central banks. Let’s look at the EUR/GBP currency pair. If the British pound increases in value against the euro, it makes British exports more expensive for European buyers. For example, when the British pound appreciates, it becomes more expensive for a car dealer from France to buy Land Rovers built in the UK as it would require more euros to buy the same amount of pounds. Consequently, the manufacturer of Land Rover could get fewer sales and the UK exports would decrease as many UK manufacturers as possible export overseas. A higher pound would also negatively affect British tourism, as almost everything would become relatively more expensive in Britain for tourists and for...

                5 Key Principles & Terms 1. Bulls and Bears What is the first symbol of the financial markets that pops into your mind when you think about Wall Street? Most probably it is the bronze sculpture of the Charging Bull. This iconic bull is the symbol of aggressive financial optimism and prosperity. It has an opposite character – a bear — and together, they represent the dual nature of the financial markets. The terms “bullish market” and “bearish market” are often used when describing the underlying trends of the market.  Bullish or “bull market” is when the market is showing confidence: currency or stock prices are going up. A bullish trader believes the market will rise. This term is used because when bulls fight, they throw their opponents up in the air with their horns. Bear market Bearish or “bear market” is when a currency or a stock rate goes down. Bearish traders are the ones who believe that the rate will decrease. Wh...