What is the connection between interest rate,inflation, and forex rate ?can someone explain with example ? -

i want to understand the phenomenon of rupee depn, high interst rate in india. the economy plays the main role in defining all these factors as u might know inflation is the rise in the prices of the commodities now interest rates does not respond directly to inflation, but to control inflation interest rates are raised. what this does is it reduces the amount of money flowing in the economy, which reduces the demand for goods and services and there by restricting the demand side of inflation now forex rates is exchange rate of one currency in respect to another. it generally reflects the rate at which the economy is growing indian economy, as a matter of fact the global economy is going through the classical quot;BOOMquot; phase, which might be followed by the quot;RECESSIONquot; phase. the boom phase is where the economy grows at an exceptionally high pace which is followed by saturation of production. here the production is not able to keep pace with the high demand of goods (which is caused by the extraordinary income of boom phase), which leads to inflation. and this further leads to high interest rates to curb the demand