How much the currency rate is important?

A currency exchange rate can be considered as the value of one country’s currency in terms of another currency. The monetary values of various currencies are decided by the foreign exchange market. Foreign exchange market is a financial market for merchandizing currencies. With the help of foreign currency rate countries assist international trade and investment among various international buyers and sellers. These services are rendered by the foreign exchange market. A wide range of factors affect the international forex rates. These factors include change in prices, national and international trade, capital movements, speculations, economic strength, government policies, stock exchange operations, political factors, etc. Moreover, even the value of currency of a country keeps varying which also results in the variation of foreign exchange rates.