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what is the foreign exchange market and how does it affect globalization?

what is the foreign exchange market and how does it affect globalization?

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Foreign exchange market is the international market of the transaction of currencies. International trade facilitated and expanded with the advent of globalization impacts the balance of trade level between nations. For example, goods which are internationally demanded implies an appreciation in the currency. A country which imports massively would sell more of its currency to get foreign currency in order to buy imports would have a negative consequence on the value of the currency of importing country. Hence there are many economic factors like political impact, economic scenario, and capital markets.

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