Tipo de Cambio

TIPOS DE CAMBIO (Banco de México) El tipo de cambio es el precio de una moneda en términos de otra. Se expresa habitualmente en términos del número de unidades de la moneda nacional que hay que entregar a cambio de una unidad de moneda extranjera. En el caso de México es la equivalencia del peso con respecto a la moneda extranjera. El tipo de cambio (FIX) es determinado por el Banco de México con base en un promedio de cotizaciones del mercado de cambios al mayoreo para operaciones liquidables el segundo día hábil bancario siguiente y que son obtenidas de plataformas de transacción cambiaria y otros medios electrónicos con representatividad en el mercado de cambios. Nota: Gráficos y otros cuadros serán ekaborados en clase. Complementar preparación de clase con "Regímenes cambiarios cambiarios en México a partir de 1954" publicado en la página de Banco de México Apunte complementario para clase en inglés. Markets - Foreign exchange market Theory 2 - Fixed v. floating - which will sink and which will swim? The two principal ways of determining the exchange rate are either to fix it against another currency or to allow it to float freely in the market and find its own level. These two systems are respectively known as 'fixed' rates and 'floating' rates. Fixed rates A fixed exchange rate is a system where the exchange rate has a set value against another currency. For much of the post-war period sterling was fixed against the dollar and it was only floated in 1972 when a fixed rate became unsustainable. To maintain a fixed exchange rate, the government needs to have a significant level of foreign currency reserves. A fixed exchange rate does not keep itself at the same level. The government has to actively intervene in the markets to keep it at the fixed rate. If, for example, there was an increase in demand for the currency (shown by a shift from D1 to D2 below), this would normally lead to the exchange rate increasing. However, the exchange rate is fixed and so the authorities have to counter the effect of the increase in demand. They do this by supplying more of the currency. In other words they sell sterling and buy other currencies instead. This shifts the supply curve to S2, and maintains the fixed rate. To maintain the exchange rate, the government had to sell sterling and buy foreign currency, therefore increasing their holdings of foreign currency. Floating rates A floating exchange rate is one that is allowed to find its own level according to the forces of supply and demand. The demand for £ comes from people who are investing in the UK from abroad and so need pounds, or from firms who are buying UK exports. They will need pounds to be able to pay for the goods. The supply comes from people in the UK who are selling pounds. This may be because they have bought goods from overseas (imports), or it may simply be that they are investing in another country and so need the local currency. To get this they have to sell pounds in exchange for the other currency. The equilibrium rate is where supply is equal to demand, and this will change as supply and demand changes. We can see this in the diagram below which shows an increase in demand for sterling - the shortage created on the market would lead to the exchange rate rising, settling at a new equilibrium level of €1.65