The Forex trading market is often thought of as a free and open market, driven by supply and demand. While this is largely true, governments play a significant role in shaping currency values through economic policies, central bank interventions, and trade regulations. Traders who understand how governments influence exchange rates can make more informed decisions and anticipate potential market movements. How Governments Shape Currency Values Governments influence Forex trading in several ways, primarily through monetary policy, fiscal policy, and direct intervention. These actions impact the strength or weakness of a country’s currency, affecting trade, investment, and overall economic stability. Monetary policy, managed by a country’s central bank, is one of…