An increase in the demand for British pounds might result from:

Question

Quizplus · Accepted Answer

An increase in the demand for British pounds can be influenced by the relative attractiveness of holding assets denominated in pounds versus those denominated in other currencies. A decline in interest rates in the U.S. would make U.S. assets less attractive relative to British assets (assuming British interest rates remain constant), thereby increasing the demand for British pounds as investors seek higher returns.

An Increase in the Demand for British Pounds Might Result