How can month end rebalancing affect the forex market

Month-end rebalancing can have an impact on forex (foreign exchange) rates, but it's important to note that this effect is usually temporary and relatively minor compared to other factors that influence currency markets. Here's how it can affect forex rates:Portfolio Rebalancing: Institutional investors, such as pension funds and large asset managers, often rebalance their portfolios at the end of the month. This involves buying or selling various assets, including foreign currencies, to maintain their desired asset allocation. The significant volume of these transactions can temporarily affect currency prices.Fluctuations in Demand: When these institutions rebalance, they may need to convert large amounts of one currency into another