How do interest rates affect the Forex market?
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Interest rates significantly impact the forex market by influencing currency values; higher rates tend to appreciate a currency by attracting foreign investment, while lower rates can lead to depreciation, with traders closely monitoring rate changes to inform their trading strategies.
Interest rates significantly affect the Forex market because higher interest rates typically attract foreign capital, increasing demand for a currency and causing it to appreciate, while lower interest rates can lead to capital outflow, decreasing demand and causing the currency to depreciate.