International Fisher Effect: Difference between revisions
From ACT Wiki
Jump to navigationJump to search
imported>Doug Williamson (Layout.) |
imported>Doug Williamson (Classify page.) |
||
| (One intermediate revision by the same user not shown) | |||
| Line 5: | Line 5: | ||
== See also == | == See also == | ||
* [[Depreciation]] | |||
* [[Fisher Effect]] | * [[Fisher Effect]] | ||
* [[Four way equivalence model]] | * [[Four way equivalence model]] | ||
* [[Spot rate]] | * [[Spot rate]] | ||
[[Category:The_business_context]] | |||
[[Category:Identify_and_assess_risks]] | |||
[[Category:Manage_risks]] | |||
[[Category:Cash_management]] | |||
[[Category:Financial_products_and_markets]] | |||
[[Category:Liquidity_management]] | |||
Revision as of 21:36, 20 May 2020
This theory predicts that the spot foreign exchange rate will change over time to reflect and offset differences in interest rates in the respective currencies.
So for example, unhedged currency depreciation losses will on average negate and match exactly any gains on interest differentials between the two currencies.
