Suppose the inflation rate in the U.S and Australia are expected to be 3% and 5.5%. If the spot rate is AUD 1.331/USD and exchange rtae one year late changes to AUD 1.315/USD, what is the real currency value change of the AUD.
A. Appreciation by 3.67%
B. Appreciation by 1.22%
C. Depreciation by 3.67%
D. Depreciation by 1.22%
E. None of the above