If a currency's foreign exchange value is expected to fall, then

Question

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If a currency's foreign exchange value is expected to fall, it means that the supply of the currency will be higher than the demand for it. As a result, the current foreign-exchange value of the currency will fall. It is unlikely that demand for the currency will rise as traders will not be attracted to a currency that they know will lose value. The country's nominal interest rate may or may not rise, depending on the country's monetary policy decisions.

If a Currency's Foreign Exchange Value Is Expected to Fall