BFW3651: Treasury Management Assignment, MUM, Malaysia Evaluate and provide a historical overview or background of the Sri Lanka’s exchange rate system

Assignment question

“Due to the multiplicity and complexity of non-financial and financial risks, as well as uncertainties to a bank, it is impractical to calculate a bank’s value-at-risk, and therefore, a bad idea to set up a costly risk management department at a bank.” Dissect, discuss and critically evaluate this problem statement. You conclusion should provide a recommendation to the opinions in the statement.

1) – Evaluate and provide a historical overview or background of the Sri Lanka’s exchange rate system (floating exchange rate regime)

2) – Download, plot and describe (eg, why there is a spike…explain & link to China, India) the exchange rate trends based on monthly data for Sri Lanka’s currency in the past 5 years

– SAME trading partners of exporter and importer must be used for Sections 2, 3, 4 & 5

(for example, for section 3 the issues that your chosen country face because of internal events must be related to China & India that is discussed in section 2. Please no do mention additional countries if it is not discussed in section 2)

– Data sources must be provided.

Analyze currency pairs from Sri Lanka’s main trading partners based on exporter, India and importer, China. (Summary of wht will be discuss in section 3,4 base on the exchange rate diagram)

3) – Identify the issues that the country faces because of the internal and/or external events

– How the events (must be related to previously mentioned issues, relate to China & India) affect Sri Lanka’s exchange rates and economies with supporting evidence.

4) – Evaluate the macroeconomic (eg, inflation, unemployment, economic growth, balance of payment) or microeconomic (eg, bank regulation, financial sector, SME) impacts of the internal and/or external trends. (Must be related to SriLanka, China, India)

– Supporting evidence is provided in the discussion.

5) – Discussed proposed solutions by the government to address the microeconomic or macroeconomic impacts.

– Was the proposed solution effective?

– Sections 3, 4 & 5 should be well linked together.

6) – Provided a comprehensive conclusion covering the main areas in the assignment

– Make suggestions for improvement and speculate on future directions.

7) Communicates using academic language, APA style and grammar with suitable headings and subheadings

Answer

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