CFA Practice Question

There are 253 practice questions for this study session.

CFA Practice Question

According to IMF guidelines, which case would require the least amount of central bank intervention in response to unwanted capital inflows?
A. Its inflation rate is low.
B. Its currency is undervalued.
C. Its short-term interest rates are low.
Explanation: An undervalued currency would lessen the probability of intervention, sterilized or unsterilized, when a country is facing unwanted capital inflows.

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