Fundamentals of Fundamental Analysis - Interest Rate Issues


 Interest Rate is usually announced by the representative of the central bank for the country. It is announced at a meeting (meeting) by the Central Bank for each country.

Central Bank and Currency

FED (Federal Reserve) - USD

BOE (Bank of England) - GBP

BOJ (Bank of Japan) - JPY

ECB (European Central Bank) - EUR

RBA (Reserve Bank of Australia) - AUD

If the interest rate is raised, it will cause an attraction to investors because the country's bank gives high interest rates, causing many investors to want to invest in the country's currency. It is a positive effect on the value of the currency.

To start investing, investors need to convert money into the country's currency, and this will result in the country's currency being bought.

If the interest rate is lowered, it will cause many investors to turn to countries that provide better interest rates, thus causing a negative effect on the value of the country's currency.

Investors will run out, and at the same time sell the country's currency.