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How Indian government affects Share market other than Fiscal and Monetary policy?
How Indian government affects Share market other than Fiscal and Monetary policy?
Expert Solution
1. Exchange rate: Change in the value of money with respect to foreign currency impacts the share market. For example, if the exchange rate value decreases, then the market share value tends to fluctuate as the domestic currency becomes cheap for the foreign people and thus, share market value goes down.
2 Change in the price of imported goods: Highly imported products and services impacts the share market. For example, Crude oil is the majorly imported goods in the Indian market, and a change in the price of imported crude oil will impact the market economy If the highly demanded crude oil is priced high, then, the economy will have a significant step back, and this could fluctuate the share market.
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