Please explain “Broad money” mentioned in prediction 2 and also explain prediction 3.
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Broad money is a category for measuring the amount of money circulating in an economy. It is defined as the most inclusive method of calculating a given country’s money supply, and includes narrow money along with other assets that can be easily converted into cash to buy goods and services.
For The third prediction we are talking about capital inflows if there are capital inflows that means the demand for the domestic currency is going up and the domestic currency is appreciating and if there is a currency crisis which will happen in the near future then let’s say for example Rupee will appreciate beyond its historical mean level if the mean level of rupee was 75 per dollar then it will go to maybe let’s say 60-65 per dollar due to increased demand for domestic currency.
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