What causes the daily fluctuations in foreign currency exchange rates?

Introduction to Financial Markets MCQs for PPSC, FPSC, NTS, and Pakistan government job tests. Select an option below, then read the explanation.

PPSCFPSCNTSPakistan govt jobs
Subject
Introduction to Financial Marketsfinance-mcqs › introduction-to-financial-markets
Published
12 May 2023
Last updated
28 May 2026

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Explanation

The primary reason for daily changes in foreign exchange rates is the variation in demand and supply. Factors like maturity periods or instrument availability have less direct impact on day-to-day currency rate movements.

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