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Economic Analysis: How To Make An Economic Analysis? What Are The Indicators? Global Economy
Economic Analysis: How To Make An Economic Analysis? What Are The Indicators? Global Economy
The economic analysis method made with macroeconomic indicators is one of the main points
of basic analysis. Due to the fact that the markets have become a single market with
globalization, global economy studies are also of great importance in economic analysis. While
the healthy progress of the economy produces positive results, in some cases, the good progress
of the economy may have negative consequences. Therefore, economic analysis demands a
great deal of detail and attention.
The analyzes generally show the effects of the country's economy on the local market or show
what the expectations will be.
For example, if the economy progresses with positive results, it may lead to a decrease in the
prices of securities such as bonds and bills, resulting in a decrease in stock prices. Another
consequence of this situation can be expected as an increase in interest rates.
A high budget deficit may signal a decrease in investment expenditures or an increase in taxes.
Both situations can happen at the same time. Increasing taxes will lead to a decrease in
consumption. Having a large budget deficit is not a desirable situation. Monitoring the direction
of government policies will constitute a good economic analysis.
Foreign Trade Volume and Deficit
Foreign trade volume and deficit are good indicators for economic analysis. It shows the
country's exports, imports, the difference between them and the foreign trade volume. It is
desirable that exports be higher than imports. It shows that the products obtained by the
companies are also in demand abroad. The high level and growth of exports indicate that
companies will exhibit investment-oriented behavior and that they are growing.
Exchange Rate and Currency Reserve
While the high exchange rate creates positive results for some situations, it can create negative
situations for some situations. It is a piece of analysis that greatly influences economic analysis.
While the increase in the exchange rate and the depreciation of the domestic currency create a
positive result for exports, raw materials etc. purchased from abroad. negative consequences
for supplies. At the same time, the high exchange rate allows imported goods to become more
expensive and local goods to become cheaper. In this case, the demand for local goods
increases.
Foreign Capital
It is one of the most followed and important items that direct the analysis of recent times.
Foreign investors, local companies, etc. It helps companies to grow by helping their
development. Foreign capital greatly affects investment and profits. It also shows that the
foreign investor gives good results in the analysis of the country in which they invest and their
expectations are increased.