According to the uncovered interest parity (UIP) theory, domestic currency depreciates when domestic interest rate falls because:

A.The depreciation in the spot market increases the expected depreciation of the domestic currency

B.The depreciation in the spot market increases the expected appreciation of the domestic currency

C.The lower yield makes the domestic currency less attractive, triggering a rise in capital inflow

D.The lower yield increases the expected depreciation of the domestic currency

E. None of the above