According to exchange rate parity, the spot exchange rate of currencies with high interest rates will appreciate and the forward exchange rate will depreciate.

Relatively low interest rates will lead to arbitrage, that is, the act of converting low-interest currencies into high-interest currencies for investment, which will make the high-interest currencies appreciate in a short time. In arbitrage, investors often make long-term compensation for arbitrage in order to prevent the loss of exchange rate changes, that is, they sell long-term high-interest currencies and depreciate long-term high-interest currencies while exchanging them at the spot.