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Natural disasters: Natural disasters can disrupt economic activity and cause currency values to fluctuate. Speculation: Go here trading activity can also influence currency values, as traders buy or sell currencies based here their expectations of future price movements.

It takes into account the relative forex factor of favtor and services between countries and provides a more foreex view of a country's currency value than the nominal exchange rate. The REER is calculated by forex factor the nominal exchange rate using the country's inflation rate and the inflation rates of forex factor trading partners.