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can u plz explain the link btw ecxhange rates and interest rates,with reference to borrowing and lending -both rates
Are you talking about exchange rates in general, or about foreign exchange risk management?
If you are talking about exchange rates in general, then it is simply the fact that different levels of interest rates in two countries are just one of the factors that influences the exchange rate. (Differentiating between borrowing and lending rates is irrelevant).
If you are talking about money market hedging (or also with regard to forward contracts) then borrowing and lending rates are certainly relevant. For a full explanation best is to watch my lecture on this website.
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