Euro-Dollar currency exchange

The euro to US dollar exchange rate is the price at which the world demand
for US dollars equals the world supply of euros. Regardless of geographical
origin, a rise in the world demand for euros leads to an appreciation of the
euro.
Factors affecting the Euro to US dollar exchange rate
Four factors are identified as fundamental determinants of the real euro to US
dollar exchange rate:
· The international real interest rate differential between the Federal
Reserve and European Central Bank
· Relative prices in the traded and non-traded goods sectors
· The real oil price
• The relative fiscal position of the US and Euro zone
The nominal bilateral US dollar to euro exchange is the exchange rate that
attracts the most attention.