Hi,Any textbook or website write the relationship between interest rates and inflation as:[(1+interest rate (local))/(1+interest rate(dollar) ]=[(1+inflation(local))/(1+inflation (dollar))]the question that I fail to find its answer is the following:what if I am trying to find an interest rate in local currency with a 10 year maturity. Should I take the inflation over 10 years? or should I take an annual inflation rate but the formula becomes:[(1+interest rate (local))/(1+interest rate(dollar) ]=[(1+inflation(local))^10/(1+inflation (dollar))^10]I hope someone can help

Doesn't it depend on whether you expect inflation to stay constant?

This is quite a strange looking formula. Shouldn't there be something about the fx rate? Thats what the parity equation usually looks like.