A high rate of inflation in one country relative to another puts pressure on the exchange rate between the two countries, and there is a general tendency for the:

Question

Quizplus · Accepted Answer

When a country experiences high inflation, the purchasing power of its currency decreases, making its exports less attractive and reducing demand for its currency. This puts downward pressure on the exchange rate of the high-inflation country's currency relative to that of the low-inflation country, resulting in a depreciation of the high-inflation currency.

A High Rate of Inflation in One Country Relative to Another