Higher interest rates will lead to arbitrage, that is, the exchange of low-interest currencies for high-interest currencies will increase the demand for high-interest currencies. After short-term arbitrage gains, the currency will be converted back to the original currency, which will lead to an increase in the supply of high-interest currency and a depreciation of high-interest currency in the long run. If the currency with high interest rate is local currency, direct quotation, forward local currency exchange rate drops, foreign currency exchange rate rises, and foreign exchange rate rises.