Emerging Markets Finance (On Page 214, Book 3 of Schweser)
about Contagion;
Schweser says;
Contagion in currencies may occur for one of five reasons:
1. A country might devalue its currency to keep its exports competitive with another country who devalued.
2. A country might see its exports decline to countries in crisis.
3..
4..
5..
i can’t understand the reason 1 and 2.
anyone explain these two “reasons”?
i would appreciate your help! |