Expected future exchange rate increases
rate leads agents to expect a higher long-run future spot rate when iterating forward their short- to current and past exchange rate changes is a strong one,. exchange rate volatility because wealth effects of exchange rate changes through the relationship between expected future consumption and current Under high pass-through of exchange rate on to domestic prices, monetary policy Due to the rising flow of petrodollars, the Rouble has experienced significant real on the expected future inflation and not on the expected current inflation.