10 Forward hedge decision Kayla Co. imports products from India, and it will make payment in rupees in 90 days. Interest rate parity holds. The prevailing interest rate in India is very high, which reflects the high expected inflation there. Kayla expects that the Indian rupee will depreciate over the next 90 days. Yet, it plans to hedge its payables with a 90-day forward contract. Why may Kayla believe that it will pay a smaller amount of Australian dollars when hedging than if it remains unhedged?