During the period between 1980 and 2010, a comparison of interest rate differential between the U.S. and the United Kingdom against their exchange rate suggest that

Question

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Interest rate differentials between countries can influence exchange rates. When the U.S. interest rate was relatively lower than that of the UK, it would typically lead to a depreciation of the dollar. This is because lower interest rates in the U.S. would make investments in the U.S. less attractive compared to the UK, leading to a flow of capital out of the U.S. and into the UK, thus depreciating the dollar.

During the Period Between 1980 and 2010, a Comparison of Interest