why do governments keep exchange rates high 
governments especially in developing economies seek to manage exchange rates to balance their ability to pay debts denominated in foreign currencies because investors generally prefer instruments denominated in more stable currencies governments in developing economies often raise funds by issuing bonds denominated in u s dollars japanese yen or euros however if the value of the domestic currency falls vs the currency in which its debt is denominated that effectively increases the debt as more local currency is needed to pay it so when the thai baht lost half of its value in 1997 that meant local borrowers needed twice as many baht to pay debts denominated in u s dollars as many developing countries also rely on imports a higher valued local currency also makes those imports cheaper in local currency terms 