Who establishes the value of the foreign currency? There are two actors that influence on the final quotation of the foreign currencies. The first one is the market law regulated by the supply and demand; and in second place the goverment politics that through the Central Bank set up the value of the foreign currency fixing it in front of the dollar, according to the economic model.
There are countries in Latinamerica where the value of the local foreign currency is devaluated in front of the dollar to help exports and generate the income of dollars through the sale of their products abroad.
These advantages that have the regional economies in Latinamerica are helped with the devaluation of the local currency and the increase of the value of the reference foreign currency, in this case the dollar.
Even if actually the value of the foreign currency is compared to the value of the dollar as reference currency, today the American currency has not the force that it used to have 50 years ago, and it can be said that slowly the dollar is getting into a one way tunnel.
The value of the foreign currency is based on the maintenance of the macroeconomic variables in orden an with superavit, so that income is greater than expenditure. Actually the United States have made the deficit a way of maintain many economies, especially the Asian ones. In incredible to think that Asian countries as Indonesia exports capital to United States instead of being the opposite, but this happens.
The United States have done that countries with commercial surplus invest their own saving in United States, becoming moneylenders of this country buying Exchequer bonds. The authorities of the Federal Reserve are sure that their commercial partners will always be forced to buy more American debt to avoid the definitive collapse of the foreign currency value and of the monetary global system.

The currencies of different countries of the world have a particular characteristic: Not all have the same force, or the same support. That’s why when we talk about foreign currencies exchange, there are currencies that have minor value in front of others and at the monetary market they are called weak currency.
When you want to exchange foreign currencies we should consider which and what is the exchange rate. An exchange rate is the difference of value between two currencies , that means that it is the currency needed to buy the other.
Foreign currencies exchange can be done with currencies in which the value dollar does not intervene, for example yen/Swiss franc at 156.60, this exchange rate that is called crossed means that a yen can be changed per 156.60 Swiss franc.
When we talk about foreign currencies exchange, we should also consider that there are two different kinds of exchange rates. One is the flexible system and the other is the fixed one.
In the flexible exchange rate system the Central Bank, adjust the exchange rate to modify the supply and demand to generate a major or minor income of foreign currencies.
A fixed exchange rate system will be very favorable for whom want to exchange foreign currencies as currencies do not fluctuate, they are fixed one according to the other. This kind of exchange rate makes the monetary authority Central Bank have an important reserve of national currency as foreign currency. In Argentine, for example, during the 90’s they set up an exchange rate fix, fixing the peso to the dollar, and so, this allowed foreign currencies exchange to be favorable to get consumer goods and travel abroad.

Foreign currencies value depends on the movements of the capital markets, even if markets are made of many elements as companies, private banks, public bank or particular investors. These actors put in risk their money and while doing it, they also take part their emotions and expectations, that make them take decisions according to information and the mood of the markets. The psychological factor many times is the one that motivates the market and so foreign currencies value. At forex market an investor behaviour can generate a chain effect and modify others’decisions making foreign currencies prices change. The foreign currencies value at forex are at this level: For example, the couple USD/JPY (dollar in front of yen) is in recovery, actually it quotes in 110.16 per dollar. Regarding to the foreign currencies value at forex of the pair EUR/USD (euro in front of dollar), it is actually having a backward movement in its quotation at 1.4608 dollars per euro. The pair USD/CAD (dollar in front of canadian dollar) is quoting at the moment at 0.9544 canadian dollars per american dollar. The traders try to break the resistance at 0.9715. The relation EUR/GPB (euro in front of pound) quotes at the moment at 0.7048 pounds per euro. The foreign currencies value of this european pair has the characteristic of floating in a floatation band from 0.7100 to 06546.