e/x rates & BOP (1 Viewer)

[hasdhil]

Hi, I need some help with the exchange rates chapter under the chapter 'australia in the global economy'. How does the balance of payments influence the exchange rate?? how are the two linked and what kind of flow on effect is there from one to the other??

thanks in advance

 

[hasdhil]

along the lines of how exactly a current account surplus or deficit would cause e/x to either appreciate and depreciate. what factors influence these changes?? how would a improvement in the CAD result in an appreciation??

does that make it a little bit more specific??