How Currency Transfer Affecting Currencies
Currency transfer solely depends on the exchange market rates between the two or more currencies . The rates keep fluctuating depending on the strength of the currency in the stock market during the exchange. Here is how currency transfer is affecting the following currencies;
The British pound is one of the strongest currencies in the world. This fact scares importers and tourist from weaker currency countries since when purchasing something, it takes much of the smaller currency to be converted to the equivalent amount in pounds. The strength of the pound, however, makes it easier for British-based firms to acquire overseas products relatively cheap and also to pay foreign manpower.
Pakistan is one of the eastern developing countries. It has a relatively low currency compared to the US dollar or the Euro. This causes the cost of importation from Europe or USA expensive since 104 Pakistan rupees is converted to just a dollar. Purchasing property overseas or taking a vacation using Pakistani currency is a disadvantage and rather expensive.
South African rand.
This is one of the strongest currency in Africa. When converted to other currencies of Africa, it has an upper hand; importation of goods and services from other African countries to South Africa is relatively cheap. When it comes to the rest of the world, however, there are stronger currencies than south Africa in which makes the usage of the SA rand rather expensive.
Swiss francs is slightly stronger than the US dollar and is known commonly for its untraceable bank systems. Currency exchange to various smaller currency in the world leads to a larger amount of the currency. This makes importation quite cheap in Switzerland. With the strong currency, converting it to foreign currency results to a larger amount in the new currency.
The Singapore dollar in the exchange markets ranks slightly lower than the US dollar. When importing goods from the USA, 1 Singapore dollar equates to 0.7 dollars. This makes importation and hiring of manpower from developed countries much more expensive. However, it is much cheaper importing from 3rd world countries.
Being the weakest currency in the world, currency transfer is against its favor in all aspects. Doing business with it from with any country is a disadvantage to you as the business person.
The euro being an economic superpower, the European euro has an upper hand when transferred to many world currencies. This makes imports to the Europe relatively cheap and imports from the Europe relatively expensive. Europe-based companies have an advantage where they can import raw materials and manpower from other parts of the world quite affordable.
Having been at war for a very long time, Russia’s currency is very weak with 1 ruble equating to 0.016$.This greatly affects its conversion rate in the market hence influencing businesses conducted by it. Being a developing country, its importation costs and overseas purchasing of goods is very expensive due to its weak economy.
In the currents world economy, US dollar is the default currency in many exchange transfers. It is relatively strong and has an upper hand in many importations and exports. It also depends on expatriates who work there as cheap labor when compared to their home currency wage.
As observed above, currency transfers have effects on the currency’s involvement in international money transfers. However, some other factors such as the money exchange company may affect the exchange since exchange rates also vary with companies.