Why Higher Inflation Leads To Stronger Currency?

Discussion in 'Trading' started by qll, Jul 11, 2007.

  1. qll


    Isn't the old thinking that higher inflation will deflate its currency, because you need more of that currency to buy the same good.

    However, look at current situations in AU, AZ, CN, and UK, we see a totally different story. The current theory is that put your money where has the highest inflation then purchase real estate there. The government will increase interest rate thus its currency value will be increased. Since it is in high inflation, its real easte value will be increased. Easy Free Money!