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The rate of inflation in a country can have a major impact on the value of its currency and the rates of foreign exchange it has with the currencies of other nations. However, inflation is just one factor among many that combine to influence a country's exchange rate.>>

Inflation is more likely to have a significant negative effect, rather than a significant positive effect, on a currency's value and foreign exchange rate. A very low rate of inflation does not guarantee a favorable exchange rate for a country, but an extremely high inflation rate is very likely to impact the country's exchange rates with other nations negatively.>>

Inflation is closely related to interest rates, which can influence exchange rates. Countries attempt to balance interest rates and inflation, but the interrelationship between the two is complex and often difficult to manage. Higher interest rates tend to attract foreign investment, which is likely to increase the demand for a country's currency. However, higher interest rates often cause increasing inflation rates, a negative influence on the country's currency. Low interest rates spur consumer spending and economic growth, and generally positive influences on currency value, but they do not commonly attract foreign investment.>>

The ultimate determination of the value and exchange rate of a nation's currency is the perceived desirability of holding that nation's currency. That perception is influenced by a host of economic factors, such as the stability of a nation's government and economy. Investors' first consideration in regard to currency, before whatever profits they may realize, is the safety of holding cash assets in the currency. If a country is perceived as politically or economically unstable or if there is any significant possibility of a sudden devaluation or other change in the value of the country's currency, investors tend to shy away from the currency and are reluctant to hold it for significant periods or in large amounts.>>

Beyond the essential perceived safety of a nation's currency, numerous other factors besides inflation can impact the exchange rate for the currency. Such factors as a country's rate of economic growth, its balance of trade (which reflects the level of demand for the country's goods and services), interest rates and the country's debt level are all factors that influence the value of a given currency. Investors monitor a country's leading economic indicators to help determine exchange rates. Which one of many possible influences on exchange rates predominates is variable and subject to change. At one point in time, a country's interest rates may be the overriding factor in determining the demand for a currency. At another point in time, inflation or economic growth can be a primary factor.>>

Exchange rates are relative, especially in the modern world of fiat currencies where virtually no currencies have any intrinsic value. The only value any country's currency has is its perceived value relative to the currency of other countries. This situation can influence the effect that an input such as inflation has on a country's exchange rate. For example, a country may have an inflation rate that is generally considered high by economists, but if it is still lower than that of another country, the relative value of its currency can be higher than that of the other country's currency. With Axis forex onlinesend money in 100+ currencies at any bank account in the world. Buy forex card for hassle-free & cashless travel. 24X7 availability!>>

 

Source : http://www.investopedia.com/ask/answers/022415/how-does-inflation-affect-exchange-rate-between-two-nations.asp

A CFD (Contract for Difference) is a financial derivative  that allows traders to profit, or incur losses, relative to the price movements of an underlying financial security. Exempt from UK stamp duty: Because the underlying asset is never purchased or sold, CFDs are free from UK stamp duty.>>

Go long or go short: Unlike trading shares CFDs allow you to profit, or incur losses, when the market is falling.>>

Deductible against UK Capital Gains Tax: Losses from CFD trading can be offset against UK Capital Gains Tax liabilities. Conversely, profits are liable to UK CGT. Tax laws are subject to change and depend on individual circumstances, please seek individual advice.>>

Hedging: Traders can potentially offset any losses to their share portfolio by short selling the same security with CFD trades.>>

Leverage: CFD trading is leveraged which means that only a small amount of the total trade value needs to be deposited. This also means that losses may exceed deposits.>>

What are the costs of CFD Trading?>>

Spread: In both of the above examples the trader incurred the cost of spread. Whether the trade had resulted in a profit or a loss, this spread cost would remain the same. The tighter the spread, all things being equal, the lower the cost of trading.>>

Commission: Certain CFD trades are subject to commission.  This will vary depending upon the market and currency traded.>>

Overnight financing: Overnight positions are often subject to financing charges. These are typically set around 2.5% + LIBOR for long positions, and LIBOR – 2.5% for short positions.  This is in effect the charge for leveraging the position.>>

Expiry>>

The majority of CFD trades do not have a set expiry date, position can be closed when a trader wants. However, there are some forward and futures contracts that expire at a set date. These contracts can still be exited early if the trader so wishes.>>

CFD positions that are left open overnight are known as ‘rolling’, and are subject to overnight financing charges.Buy Forex Online: With Axis Forex online send money in 100+ currencies to any bank account in the world. Buy forex card and go cashless across the globe>>

Source : https://www.corespreads.com/knowledge-base/cfds-explained/>>

Online trading is basically the act of buying and selling financial products through an online trading platform. These platforms are normally provided by internet based brokers and are available to every single person who wishes to try to make money from the market.>>

Most brokers, like iFOREX, provide a variety of financial products including Shares, Commodities, Indices and Forex. While trading Shares like Google or buying and selling Commodities like Gold or Silver might be quite familiar, Forex trading has gained extreme popularity over the last couple of years due to some of its major features.>>

What is Forex?>>

To make this simple, imagine you are getting ready for a trip to New York and you exchange 500 Euros into Dollars. A week later, your trip is unfortunately cancelled and you decide to change your Dollars back into Euros. Surprisingly, you end up with 505 Euros: a profit of 5 Euros!>>

This is known as a profitable foreign exchange trade. You initially purchased Dollars at a certain rate of exchange and during the week that followed, the value of the Dollar went up against the value of the Euro.>>

Without even meaning to do so, you managed to make a small profit as you bought your Dollars at a low rate and sold them back at a higher rate - the aim of any successful trade.>>

Nowadays, there is no need to go to a bank or post office, or even leave your house for that matter - you can simply trade online using your home computer or mobile phone.>>

As mentioned above, from the palm of your hand you can trade Forex, which includes currencies such as the Dollar or Euro, a variety of Commodities such as Gold or Oil and even major market indices.>>

Here are just a few examples of products you can trade with iFOREX:>>

You don’t have to be a professional to trade online. You can open a trade by selecting a product, amount and direction, and close it if your trade is in profit at any time you choose.>>

No Commission for Opening/ Closing Deals>>

Still paying commissions to traditional institutions like banks?>>

with iFOREX you can open and close trades with competitive spreads and commission free!>>

There are no additional commissions charged for opening/ closing deals on any product when you trade with us.>>

With Axis Buy Forex Online send money in 100+ currencies at any bank account in the world. Buy forex card for hassle-free & cashless travel. 24X7 availability!>>

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Source : https://www.iforex.in/getting-started>>

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