When a currency gets stronger, that forward rate of the currency must have increased against all currencies.

Question

Quizplus · Accepted Answer

When a currency gets stronger, its forward rate against other currencies may increase, decrease, or remain unchanged depending on various factors such as interest rate differentials, inflation rates, economic conditions, and geopolitical events. Thus, it is not necessarily true that the forward rate of a currency must have increased against all currencies when the currency's strength increases.

When a Currency Gets Stronger, That Forward Rate of the Currency