Posted by
admin on Apr 17, 2011 in
Interest Rates |
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If there are perspectives for the Referring Interest to increase, the currencies will appreciate compared with the inflation rate. It might sound weird, but the inflation has a positive aspect on the exchange rate, amongst other macro economic indicators.
A high level of inflation means an increase in the base prices of the geographic area. On the other hand, a strong national currency affects the exports and the performances of the national goods and services that affect the national currency in a negative way.
This is why the main objective of the national bank is to...