If Japanese real interest rates fall relative to real interest rates in the U.S.,the yen will likely appreciate and the dollar will likely depreciate.

Question

Quizplus · Accepted Answer

If Japanese real interest rates fall relative to real interest rates in the U.S., it would lead to a decrease in demand for yen and an increase in demand for dollars, which would cause the yen to depreciate and the dollar to appreciate.

If Japanese Real Interest Rates Fall Relative to Real Interest