Generally economic fundamentals are used to understand the reason behind the exchange rate movements. Historical price movements are compared to the economic fundamentals to find those economic indicators which affect the exchange rates. The methods based on the current fundamentals are not very efficient enough in explaining the past or the future consistently, it is evident through (Dornbusch 1976, 1987; Meese and Rogoff, 1983; MacDonald and Taylor 1991). It is because of these failures that the investors stopped to rely solely on the fundamentals and started to look for the non-fundamental factors which are affecting the market along with the approaches widely used by the analysts.
Volume 12 | Issue 8
Pages: 284-291
DOI: 10.5373/JARDCS/V12I8/20202475