I am trying to understand what information moves a currency so that I can react/anticipate faster and become a better trader.
1. When people are saying that they think the fed will cut interest rates, I can understand that investors might want to take their money elsewhere and that would devalue the USD. However, why would the Fed want to do that? Does it help control inflation?
a. When the fed lowers interest rates, is this to promote growth of the ecomony as more people will look to expand/build as the cost of money has gotten cheaper?
2. When the Euro, Yen and pound gain value, the US has to pay more for imports. Does this affect how much imports the US buys and furthermore, would that lead to a devaluing of the Euro, Yen and Pound?
thanks.
1. When people are saying that they think the fed will cut interest rates, I can understand that investors might want to take their money elsewhere and that would devalue the USD. However, why would the Fed want to do that? Does it help control inflation?
a. When the fed lowers interest rates, is this to promote growth of the ecomony as more people will look to expand/build as the cost of money has gotten cheaper?
2. When the Euro, Yen and pound gain value, the US has to pay more for imports. Does this affect how much imports the US buys and furthermore, would that lead to a devaluing of the Euro, Yen and Pound?
thanks.