What direct factor influence the rise or drop of currency effectiveness?
Answers:
Supply and constraint. This is directly related to import and exports. Imagine you live in the states and want to introduction a container of widgets from Japan. To do this you must deal in dollars (Supply of dollars go up constraint go down so price go down) and buy Yen (Demand go up, supply go down price does up). This would end in (If done on a hulking scale) the price of dollars relative to yen to drop and thus the exchange rate would change aim that equal amount of dollars would buy smaller quantity yen and vice versa. While trade is the crucial driver of exchange rates, any desire for currency will affect them. If you of late want to buy dollars as a locked haven (As is a relativly stable currency) this increased constraint will push up their price, as would buying a currency so you could invest money in a given country.