Funds may be switched from one currency to another until the interest rate gap reflects the expected appreciation or depreciation of one currency against the other.

Under the floating-rate system a fall in the market price (the exchange rate value ) of a currency is called a depreciation of that currency ; a rise is an appreciation .

The report also said China's use of interest-rate increases to cool domestic demand, and currency appreciation to address external imbalances, are 'appropriate.