Question

If the yield curves for major currencies are all positive, what is your impression
of global interest rates? All other things be unchanged, would your domestic interest rates be inclined to move down or up?

Answer 1

The change in the global interest rate goes hand in hand with the currencies.

So when the yield curve goes up for the Major currencies this will lead to increase in the demand and thus consequently will result in higher interest rates.

That means the global interest rates rates will be higher and thus making them more attractive as compared to others.

Now the domestic interest rates would be inclined to go up to make our economy equally attractive as compared to the global economies and thus increase the flow of money in the domestic ecomony to support its currency in the global markets