International travel is a wonderful experience that everyone should take advantage of at some point in their life. It gives you the opportunity to submerge yourself into new and different cultures that you otherwise wouldn’t be able to experience simply by staying in the states. Although many wild tell tales of how they backpacked through Europe with very little money in their pockets, there’s still a common understanding whether you travel with nearly nothing, or in the height of luxury, and that’s that you need to know exchange rates.
Of course, there’s a good chance you’ve traveled to Mexico or Canada where you’ve had to exchange your American dollars into Canadian dollars or pesos, but do you actually get how the exchange rates work? Or do you just give them the money and go with the flow?
The easiest way to get the general gist of how exchange models work is to think of it with apples and oranges, so how many oranges does it take to buy one apple? That’s what many refer to as the demand and supply model – how many dollars does it take to get one euro?
Predicting the Exchange Rate
- Interest Rates
- Inflation Rates
Those are the two primary factors in determining what direction your exchange rate will go. Every country has a monetary policy which dictates whether the inflation rate increases or decreases. If it increases, there was most likely an expansion within that countries policy. If this policy is expanded, there’s a growth within the money supply as well as a decline in the bank’s interest rate.
The Importance of Exchange Rates
If it weren’t for foreign exchange rates, we wouldn’t be able to express the value of an item across oceans, borders, and different cultures. Exchange rates allow for everyone to experience what every part of the world has to offer. When you travel with our group, Women Traveling the World, we guarantee you’ll see some of the most beautiful destinations the world has to offer and you’ll definitely get firsthand experience with exchange rates.
Whether it’s Canada or Greece, the possibilities are endless with our group. There are so many different ways of living life that we may not see in the states, so why not take advantage of travel and go see those places? Visit our Women Traveling the World website to see our upcoming trips; you’re more than welcome to join us. If you need help with any part of the planning process, we can assist you as we have several years of experience working in the travel industry.
So what are you waiting for? Go take a look at our upcoming itinerary’s to see if any trips catch your eye.