This is a complicated answer that uses the IS-LM-BP model, but being rather complicated i dont go into fine detail. It is hard to know what is better for an economy. Raising the interest rate lowers consumer purchasing but increases the capital account through investment and vise versa. INcreasing government funding increases money in the economy, thus interest rates increase along side output. But being a new keys myself, i believe that both fiscal and monetry policy can aid in this, but can be seen more easily if only one approach is used first as both measures have different lags.
Exchange rates feed of the following variables
1) the exchange rate of another nation (nominal) and the exchange rate of the host country minus (as below)
2) CPI
3) PPI
These combinations make up an exchange rate figure that is used for money trading. The value of exchange rates and thus money is affected by the following:
1)demand for the currency
2) inflationary rates of a host exchange rate vs other exchange rates
3) future pricings (co-intergration linked with the futures commidity market)
I hope this helps
