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What are the factors that affect a country's currency?
How do interest rates factor into a country's currency value?
Interest rates are another important factor that can affect a country's currency. When a country raises interest rates, it can increase demand for its currency because investors can get a higher return on their investments. This can cause the country's currency value to rise. Conversely, when a country lowers interest rates, it can decrease demand for its currency and cause its value to fall.