Question
If all other factors remain constant, and country A announces a surprise 75 basis points interest rate increase while country B.announces a surprise 50
If all other factors remain constant, and country A announces a surprise 75 basis points interest rate increase while country B.announces a surprise 50 basis points interest rate increase, what is the anticipated short-term FX movement between country A and country B in relation to each other? Country A's currency will increase relative to Country B Country B's currency will increase relative to Country A The currencies of both countries will increase in value against each other.
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