XII Banking - Question 27 - Direct and Indirect Methods Adopted of Exchange Control

Q.27. Compare the direct and Indirect methods adopted of exchange control.


COMPARISON OF DIRECT & INDIRECT METHODS

These methods of exchange control are known as indirect methods because they do not control the exchange rate but only influence it. On the others hands the direct methods of intervention, restriction and exchange clearing agreements have the effect of directly controlling the exchange rate or the foreign exchange market.