What Moves Currencies
Interest rate differentials, parity conditions, central banks and flows — the real drivers of an exchange rate, stated honestly, including where each one stops working.
Start here
Why does the gap between two policy rates move an exchange rate?
Start the first lessonUnit 1 Interest Rates & the Carry Trade
- Why does the gap between two policy rates move an exchange rate?
- Why do investors borrow in yen to buy Australian dollars?
- Why does a carry trade give back years of gains in a week?
- What makes one currency a funder and another a target?
Practice Check · Unit 1 A short check · cannot be failed Start
Unit 2 Parity Conditions & Long-Run Anchors
- Why is the forward rate arithmetic, not a forecast?
- Why doesn't the high-yield currency fall the way theory says it should?
- Can a Big Mac tell you what a currency is worth?
- Do trade balances actually move currencies?
Practice Check · Unit 2 A short check · cannot be failed Start
Unit 3 Central Banks, Pegs & Intervention
- Why does FX trade the difference between two central banks?
- What actually happens when a central bank intervenes in the FX market?
- What does it actually cost to hold a currency peg?
- What broke on 15 January 2015?
Practice Check · Unit 3 A short check · cannot be failed Start
Unit 4 Risk Appetite & the Dollar
- Why do some currencies rise when everything else is falling?
- Why does the Australian dollar trade like a commodity?
- Why does one country's currency price everyone else's trade?
- What moves currencies — course checkpoint
Practice Check · Unit 4 A short check · cannot be failed Start
Last Course exam
One exam, the whole course Unlocks when you have read all 16 lessons
Passing it earns the course certificate.