Exchange Rate Fluctuation While Economic and Political Turmoil

Assume that other countries experience economic and political turmoil and become less stable when compared to the United States. Discuss exchange rate fluctuation in this case.

Exchange rate fluctuation may affect industries that are in direct competition with foreign producers or rely on their supplies. Specifically, international competitiveness is affected by the influence the exchange rate has on relative costs. How will the event described above affect the foreign exchange market? Will your answer be different if the currency was pegged? Please explain if a dirty float system will change your assessment.