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    Economics A-Level

    Hot money flows

    What Hot money flows means in Economics A-Level, as defined for AQA.

    Definitions of Hot money flows

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    Reference: AQA

    Short-term speculative capital attracted into the UK when higher interest rates give savers and foreign investors a higher return on sterling deposits.
    AQA · Central banks and monetary policy
    Short-term flows from foreign investors seeking higher returns, attracted by raising interest rates.
    AQA · Exchange rate systems
    Short-term, speculative capital flows that move rapidly between countries in response to interest rate differentials, exchange rate expectations, or changes in investor sentiment. They are highly volatile and can reverse quickly, creating macroeconomic instability.
    AQA · The balance of payments (study guide)

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