Shaping Exchange Rates

“Consider the exchange rate between the US Dollar and the Thai Bhat, the Pound Sterling and the Turkish Lira, since 2000.
Using relevant economic models and data, evaluate what forces have shaped the developments of the exchange rate between the two currency areas.
Given that currently the USA is recovering from one of the most severe recessions in its recent history, assess what policy measures (if any) the US has its disposal with respect to the exchange rate, in order to aid its recovery from recession.
Consider both relevant economic models and data in order to establish the scope of feasible policy intervention.
In doing so, be certain to outline the consequences (costs and benefits) of the policy suggestions.
In writing your response, please note that you will be assessed on the ability to apply appropriate economic models, to marshal these toward the assessment of empirical (data driven) evidence, and for your ability to use both models and empirical evidence to argue for a coherent and consistent policy position.
You are responsible both for sourcing appropriate references, as well as for the sourcing and collection of relevant data.

One possible reference may be ‘International Economics: Theory and Policy’ by Paul Krugman.”

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