11. To keep the domestic currency from depreciating, the oentral bank intervenes. in the foreign exchange market purchasing the domestic currency with its foreign exchange holdings. FXrate D Domestic cmawttimepeiod Answer for FX and Q of domestic currency: 12. To keep the domestic currency from depreciating, the central bank increases the interest rate above the prevailing rate in other developed countries. FXrate D Domestic cmemcyitirnepeiod Answer for FX and U: of domestic currency