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Behavior of Exchange Rate Volatility: Once Again in Action

Author

Listed:
  • Khuram Shafi
  • Liu Hua
  • Amna Nazeer
  • Zahra Idrees

Abstract

In the area of international trade few studies have examined whether fluctuation in exchange rate is base on macro variables that are used in this study. Basically the study is conducted in Pakistan. As it has been noticed that there is continuously increasing in exchange rate since last 20 years. This paper investigate that foreign direct investment, inflation and supply of money have strong relationship with exchange rate. This means that if there is increase in foreign direct investment then the exchange rate will decrease, if there is increase in supply of money then the exchange rate will grow and if there is increase in inflation then the exchange rate will increase and vice versa.

Suggested Citation

  • Khuram Shafi & Liu Hua & Amna Nazeer & Zahra Idrees, 2015. "Behavior of Exchange Rate Volatility: Once Again in Action," International Journal of Academic Research in Business and Social Sciences, Human Resource Management Academic Research Society, International Journal of Academic Research in Business and Social Sciences, vol. 5(1), pages 270-276, January.
    • Handle: RePEc:hur:ijarbs:v:5:y:2015:i:1:p:270-276
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    References listed on IDEAS

    as
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    More about this item

    Keywords

    Exchange rates; Money supply; Inflation; Foreign direct investment;
    All these keywords.

    JEL classification:

    • F31 - International Economics - - International Finance - - - Foreign Exchange
    • F30 - International Economics - - International Finance - - - General
    • P33 - Political Economy and Comparative Economic Systems - - Socialist Institutions and Their Transitions - - - International Trade, Finance, Investment, Relations, and Aid

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