Exchange Rates

Impact of a change in the Rand/dollar exchange rate on imports and exports

The purpose of these clips are to present an introduction to the foreign exchange market, in which Japan is treated as the foreign country and Canada is treated as the domestic country. I look at the sources that cause both the supply and the demand for foreign exchange. I also cover the supply and demand curves for foreign exchange and briefly touch upon why they are shaped the way that they are. Finally, I touch upon the distinction between floating and fixed exchange rate regimes and the role of the Bank of Canada in fixing exchange rates.