1.0 INTRODUCTION AND BACKGROUND OF
The need for foreign currency policy management arises only within the frame-work of countries engaged in international trade in contract to a closed economy, whose scope does not transcend its intra country trade transactions.
Foreign exchange is the means or ways of effecting payment for international transaction it can be acquired by a country through the export of goods and services, direct investment inflow drawn down on external loans aid or grants and it can also be expanded on settling international obligations. It is made up of convertible currencies that are generally accepted for the settlements of international trade and other external obligations. Such currencies include those of the group of seven (G7) industrialized countries made up of united state Dollar, British pound sterling, deutsche mark, Japanese yen, French, Italian and Canadian dollar.
Foreign exchange market is the medium of interaction between the sellers and buyers of foreign...