Can someone pls explain the relation between current account deficit, domestic savings& investment, currency overvaluation (or currency depreciation ? are they same?)
I get that when domestic savings is more than investment -> excess demand for capital (currency appreciation)->, foreign savings are used which leads to current account DEFICIT
However, in answer to one of EOC curriculum questions (Qn#18) current account SURPLUS is mentioned as an indicator of currency strengthening. This seems to be in contrast to above mentioned linkage. What am I missing?