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I'm now studying about international trade and policy. I've known that higher interest rate would attract foreign investment therefore the demand for domestic's currency gone up and increase the value of the domestic currency. But I'm wonder would an increase in FDI increase the value of the local currency?

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If an American company received FDI from a foreign investor, that investor would need to buy USD to proceed with their investment,.

This would increase the demand for USD and hence raise its value/exchange rate against other currencies.

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