Countries that refuse to raise interest rates will experience a very sharp depreciation of their exchange rates

With inflation rising almost across the board, almost all central banks are raising interest rates rather quickly. This means that countries where the central bank is not rais ing interest rates (China, Japan and Turkey, for example), in some cases because the country refuses to exit the expansionary monetary policy, and in other cases because country is an exception and has low inflation, are experiencing and will continue to experience a sharp depreciation of their exchange rates. If this depreciation ultimately leads to inflation, these countries will also be pushed to raise interest rates, unless the central bank has completely abandoned the inflation target and ignored exchange rate movements.