How Does the Government Regulate Exchange Rates?
How Does the Government Regulate Exchange Rates?
By Kimberly Amadeo Updated July 29, 2020
The government indirectly regulates exchange rates because most currency exchange rates are set on the open foreign exchange market (Forex). In some countries, like China, the exchange rate is fixed, and the government directly controls it. This Chinese currency rate control of their yuan, in turn, affects the U.S. Dollar. The yuan is loosely pegged to the U.S. dollar.
Government Influence
The U.S. government has various tools to influence the U.S. dollar exchange rate against foreign currencies. The nation's central bank—known as the Federal Reserve (Fed)—is an independent arm of the government. It indirectly changes exchange rates when it raises or lowers the fed funds rate—the rate banks charge to lend to each other.
For example, if the Fed lowers the rate, that drives down interest rates throughout the U.S. banking system. It also reduces the supply of money. Both of these results make the dollar stronger relative to other currencies. That's because U.S. dollar-denominated credit has become more expensive. At the same time, dollar-denominated assets generate a higher return. Both create more demand for the dollar while taking it out of circulation. The laws of demand and supply tell you that less supply and more demand drives up the price.
When that happens to the dollar, it can purchase more foreign currency on forex markets.
Treasury Department Role
The Treasury Department is a government agency that also indirectly affects the exchange rate. It prints more money. This printing increases the supply and weakens the dollar. It can also borrow more money from other countries. That's done by selling Treasury notes. That increases the supply of money and increases the U.S. debt, and both will send the dollar's value down.
To continue reading, please go to the original article here:
https://www.thebalance.com/how-does-the-government-regulate-exchange-rates-3306087
Note: All intel should be considered as "Rumors" until we receive official announcements ...and “Rates and Dates” could change anytime until we get to the banks/redemption centers.
RV Excerpts from the Restored Republic via a GCR Update as of Wed. 5 Aug. 2026
Compiled Wed. 5 Aug. 2026 12:01 am EST by Judy Byington
The Plan Never Failed
The Great Awakening Golden Age of Freedom & Sovereignty Has Arrived
The World Has A Fair, Transparent, Asset-backed Financial System
As Old Systems of Control, Deception & Scarcity Collapse
Iraq's Issued Currency Hits $86.3B In May
2026-08-04 Shafaq News- Baghdad Iraq's issued currency rose to 113.560 trillion dinars ($86.3B) at the end of May 2026, up from 112.896 trillion dinars ($85.8B) a month earlier, as cash circulating outside the banking system continued to increase, according to official data released by the Central Bank of Iraq (CBI).
Good Morning Dinar Recaps,
Global Bond Markets Flash Warning Signals: Rising Treasury Yields Test Confidence in the Financial System
Global bond markets are sending an increasingly important message as investors weigh persistent inflation, growing government debt, and the Federal Reserve's next policy moves, with implications reaching far beyond Wall Street.
Gold at $42.22 and "One of the Great Mysteries" | Phillip Magness
Kitco News: 8-4-2026
Economic historian Phillip Magness tells Kitco News anchor Jeremy Szafron that Americans who surrendered gold in 1933 at $20.67 an ounce got none of the gain when Washington repriced it at $35 less than ten months later.
"It's always the private sector that gets the bad end of it." America's 261.5 million ounces are still carried on the federal books at $42.22 an ounce, about $11 billion against more than $1 trillion at market.
Currency Printing Is Knocking On Iraq's Door... Warnings Of An Economic Catastrophe
August 4, 2026 Last updated: Al-Mustaqilla/- Al-Mada newspaper revealed in a report followed by “Al-Mustaqilla”, the escalation of the financial liquidity crisis in Iraq, after the Parliamentary Finance Committee proposed the option of resorting to printing currency to secure employee salaries and avoid a financial crisis that some MPs described as potentially leading to a “revolt of hungry stomachs”, at a time when economists warn that this option may open the door to a dangerous wave of inflation if it is not accompanied by a real increase in production.
Good Evening Dinar Recaps,
Bond Market Warning: Rising Treasury Yields Signal Growing Pressure on the Global Financial System
While stock markets remain near record highs, rising Treasury yields are revealing deeper concerns about government debt, inflation, and the long-term stability of the global financial system.
Ross: The Thing about the Clarity Act
8-4-2026
In 2030 and beyond everyone is going to look back in hindsight at how primitive it seems to consider that in just 2026, the crypto industry was held back as long as it was due simply to a lack of regulation.
There is a nuclear explosion of growth pending in this market.
We’ve seen nothing yet.
Good Afternoon Dinar Recaps,
Hormuz Breakthrough? U.S.–Iran Talks Spark Global Market Optimism
Signs of a possible U.S.–Iran agreement are easing fears over the Strait of Hormuz, sending oil lower, boosting global markets, and raising hopes for improved financial stability.
Oil Rebounds On Renewed Middle East Tensions
2026-08-04 Shafaq News Oil prices rebounded 1% on Tuesday from a plunge in the previous session, fuelled by concerns that Middle East supply remains at risk as a diplomatic resolution to the U.S.-Iran war that has disrupted shipments still seems unlikely.
Front-month Brent futures rose $1.12, or 1.3%, to $84.89 a barrel by 0355 GMT after dropping 7% in the previous session to a three-week low.
TNT:
Tishwash: Washington begins withdrawing its last troops from Iraq and Kurdistan, ending its military presence.
A report published by Al-Monitor on Saturday (August 1, 2026) revealed that the US military has begun implementing the final phase of its military withdrawal from Iraq by withdrawing its last remaining forces in the Kurdistan Region, along with air defense systems and related military equipment, in a move that represents the conclusion of the plan to end the US military presence in the country.
The report, which was followed up by "Baghdad Today", stated that the withdrawal includes forces stationed in bases within the Kurdistan Region, which represented the last American military presence after the completion of the evacuation of bases located within the areas under the control of the Iraqi federal government at the beginning of this year.
KTFA:
Clare: Channel8 Exclusive: Iraq Faces Liquidity Crunch as Oil Revenues Fall
At a Glance
Iraq faces a cash liquidity shortage.
July salary funding remains under pressure.
Oil revenues have dropped sharply.
Salaries Are Causing Panic Among Iraqis; Parliamentary Action Is Underway To Secure Them.
Information/Special.. MP Duha Laibi Al-Bahadli revealed today, Monday, a parliamentary move to host the Minister of Finance inside the House of Representatives, to discuss the issue of salaries and to identify the most prominent financial challenges facing the process of securing them.
Good Morning Dinar Recaps,
BRICS Payment Push Accelerates: Alternative Trade Systems Gain Momentum
BRICS nations are advancing local-currency trade and cross-border payment infrastructure, signaling another step toward a more diversified global financial system.
Rob Cunningham: One Ultimate Token Question
8-3-2026
One Ultimate Token Question
“If all ‘powers that be’ were forced to vote in support of one, and only one, ‘synthetic hegemonic currency’ the world must adopt today, and use for the next 10 years, with no wiggle room, delays or excuses, what token would be chosen, today?”
ANSWER:
XRP.
What Iraq’s Liquidity Crisis means for the IQD
The Dinar Den: 8-4-2026
In the complex landscape of international finance and emerging markets, few topics generate as much discussion as the Iraqi Dinar (IQD). Recently, Stephen of The Dinar Den, a seasoned entrepreneur and long-term investor in the region, shared a comprehensive update regarding the current state of Iraq’s economy.
His insights provide a necessary reality check against common rumors, focusing instead on the structural hurdles and the massive potential for reform currently unfolding within the nation.