2. Literature Review
I t e m s AU T H O R F I N D I N G S
EXCHANGE RATE OF
CURRENCIES AND
INTEREST RATE:
Khawaja and Uddin (2007) An increase in interest spread implies that either the depositor
or the borrower or both stand to lose.
EXCHANGE RATE OF
CURRENCIES AND
INFLATION:
Dritsakis (2011) The elasticity of real income was positive, while that of inflation
and exchange rate was negative.
CURRENCY AND
INTERNATIONAL
FISHER EFFECT:
Thomas (1985) IFE theory the study found that 57 percent of the transactions
created by this strategy were profitable.
PURCHASING
POWER PARITY
AND EXCHANGE
RATE OF
CURRENCY:
Pedroni (2001) Indicate mixed evidence of PPP based on panel unit root tests.
He illustrated the existence of weak PPP and he rejected of
strong PPP concept.
12. Inflation rate 2014-2018:
Inflation rate 2014 2015 2016 2017 2018
USA If .8% .7% 2.1% 2.1% 2.5%
Bangladesh Ih 7% 6.19% 5.52% 5.70% 5.40%
0.00%
2.00%
4.00%
6.00%
8.00%
10.00%
2014 2015 2016 2017 2018
USA Bangladesh
13. Forward Rate
2014 2015 2016 2017 2018 2019
Forward
rate
81.65Tk/
Dollar
82.73Tk/
Dollar
82.36Taka/
Dollar
81.56Taka/
Dollar
85.67Taka/
Dollar
85.59taka
/dollar.
79
80
81
82
83
84
85
86
2014 2015 2016 2017 2018 2019
FORWARD RATE
Forward rate
14. CONCLUSION
Foreign exchange gives a window to its financial
strength. We suggest to avoid any potential falls in
currency exchange rates & overall level of economic
health is determined. Inflation, interest rate & poor
monetary policy is causing to fluctuate the exchange
rate of Bangladesh.
15. The exchange rate are of great importance and can effect the
overall growth and development of the country’s trade and
economy. The country should try to make their currency strong and
try to stabilize their exchange rate so as to improve the country’s
trade and economics.