Macro
Oct 24, 2026 6 min read
Forex Fundamental Analysis: Interest Rates, Inflation and Economic Growth
Fundamental analysis in forex reduces to three drivers and one transmission mechanism: inflation and growth set what a central bank is likely to do, the expected interest-rate path is what the currency actually trades on, and the differential between two countries' paths is what moves the pair. This guide explains each driver, how they feed the rate path, how to read the differential rather than the level, and the two situations where the model inverts.
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