Post
Topic
Board Economics
Re: How to strengthen a country's currency?
by
zimmah
on 21/06/2014, 22:55:20 UTC
I would really like to know the best way to strengthen a country's currency.
Increase in it's import or export?
Please share some good ideas.

Back it with bitcoins.

Anyway import normally decreases a currency (money goes out, making it less popular and more plentiful outside the countries sphere of influence)

Export normally increases the currency, Altough it might reduce a countries true wealth as you recieve deflationary currency for physical goods.

It's not as simple as this though.

Also keep in mind that countries that live of export often want their currency to be weak, so that they can offer more competitive prices. (China and japan often weaken their currency on purpose to stay competitive in exports, china even more than japan).

The euro is strange in this as some countries live of import and others from export. So some countries prefer a strong euro (for cheaper imports) while others need a weak euro (for more competitive prices on the export market, or else you won't find any buyers). On top of that some exports require imports first. For example plastics and chemicals require the import of oil and other chemicals, they then get refined and the refined product is exported.

So in general these guidelines are true but in practice it's a pretty complicated question.