Analysis of the relationship between economic and financial indicators and exchange rates of fragile five countries

The changes in exchange rates and their impact on attracting foreign investors constitute an important issue in the context of the global economy and international investment. This thesis examines how factors (oil price, inflation, exchange rate, foreign exchange reserves, interest, Bitcoin, foreign exchange reserves, and stock market index) affect the causal relationship between exchange rates. The research examines five countries with fragile economies or five fragile countries (Turkey, Brazil, South Africa, Indonesia, and India). In addition, this thesis aims to reveal the causality between these variables and the currencies of the countries and how they affect exchange rates by examining the main factors affecting exchange rate fluctuations separately for each country. The thesis aims to identify the differences and similarities between the five fragile countries in terms of the factors affecting exchange rates, to provide policy recommendations specific to each country, and to offer suggestions on stabilizing the exchange rate and attracting foreign exchange and investments to the country. This study, which brings together oil prices, inflation, exchange rates, foreign exchange reserves, Bitcoin, interest rates, and stock market index, will reflect clearer results in exchange rate volatility and allow for more accurate analysis in investment decisions. It will help local and foreign investors to have information about which variables foreign exchange rates depend on and to support foreign exchange transactions and investment decision processes. In this context, the thesis can help us identify important and previously neglected effects on exchange rates and better understand how these affect foreign investment decisions in these countries.