Macroeconomics monetary policy/International trade

Trade among countries serves many functions aside from the exchange of goods and services at a global level. For instance, trade facilitates movements of foreign currencies held in a country's bank because imports are paid in the unit of the exporting country's currency. Additionally, trading partners have more and a greater variety of goods available to them. In short, those gains from trade arise out of comparative advantage, specialization, and export activities.

However, international trade can become and often is an emotionally or politically charged issue that cuts across microeconomics and macroeconomics; it is probably a good time now to recall the difference between them. Nonetheless, most of the content here centers on the topic from an economic perspective and directs attention to factors such as trade balances, exchange rates, and other aspects of a country's macroeconomic performance.