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Anonymous

18 Apr 2019

General Investing

How do interest rates affect currency rates?

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Nicholes Wong

27 Feb 2019

Diploma in Business Management at Nanyang Polytechnic

Interest rate will be related to both loans and savings accounts interest just in case you dont know.

Low interest rate will result in lower/bad currency rate. Governments will usually drop the interest rates if they want to boost the countrys economy. So that people will be less likely to save their money and even get loans to spend more money since interest rate is low. This usually means economy not doing too well hence government are reducing interest rate to boost economy. If economy not doing well, less people will want to invest in the country and result in lower/bad currency rates. So vice versa if interest rate is high, this usually shows that the economy is doing great and people will be more likely to invest in the country and result in higher/better currency rates.

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