The political stability of countries has an impact on the foreign exchange market.

Question

Quizplus · Accepted Answer

Political stability is one of the key factors that affect the exchange rate of a country's currency. If a country is politically stable, it attracts foreign investments, which strengthens its currency. On the other hand, if a country is politically unstable, investors lose confidence, and it leads to a weaker currency. As a result, political stability has a direct impact on the foreign exchange market.

The Political Stability of Countries Has an Impact on the Foreign