The Mexican Peso has had an average of 5% inflation YOY over 10 years. The value of MXN compounded as an asset price would have a fair value of true value of approximately 20.66.
Inflation is just one contributor to a currencies value. A higher interest rate can attract foreign investment from investors but a low-interest rate will make investors less willing to take currency risks. Political risk and economic performance also have a significant impact on currency. The higher the risks and the lower the interest rate the less foreign investors will want that currency.
Typically a currency will trade in a sideways range until an event. The event will allow the currency to break out, putting it into a new range. Although in the short term the rapid appreciation or depreciation may seem exaggerated they are typically just adjusting into the longer-term trend
Inflation is just one contributor to a currencies value. A higher interest rate can attract foreign investment from investors but a low-interest rate will make investors less willing to take currency risks. Political risk and economic performance also have a significant impact on currency. The higher the risks and the lower the interest rate the less foreign investors will want that currency.
Typically a currency will trade in a sideways range until an event. The event will allow the currency to break out, putting it into a new range. Although in the short term the rapid appreciation or depreciation may seem exaggerated they are typically just adjusting into the longer-term trend
Penafian
Maklumat dan penerbitan adalah tidak dimaksudkan untuk menjadi, dan tidak membentuk, nasihat untuk kewangan, pelaburan, perdagangan dan jenis-jenis lain atau cadangan yang dibekalkan atau disahkan oleh TradingView. Baca dengan lebih lanjut di Terma Penggunaan.
Penafian
Maklumat dan penerbitan adalah tidak dimaksudkan untuk menjadi, dan tidak membentuk, nasihat untuk kewangan, pelaburan, perdagangan dan jenis-jenis lain atau cadangan yang dibekalkan atau disahkan oleh TradingView. Baca dengan lebih lanjut di Terma Penggunaan.