When the local economy is doing well (high GDP growth, stable inflation, higher employment, and stronger currency), then

[answerhappygod]

When the local economy is doing well (high
GDP growth, stable inflation, higher employment, and stronger
currency), then it might attract foreign investors who
wish to invest in physical capital (factories for
example) or financial assets (stocks,
bonds, money market, etc.). The flow of funds from foreign
investors will have a positive (increase) effect on the money
supply, but a negative effect on interest rates. In addition,
foreign investors will need to purchase (exchange) the currency of
the country they wish to invest in using their local
currency. This means an increase in demand for that
country’s currency. This increase in demand causes the value of
that currency to rise. This rise in the value of the currency in
the global exchange market will cause an increase in the prices of
exportable goods/services relative to other
countries. In other words, when the country’s economy is attractive
to foreign investors, this could lead to a higher price level in
that economy for foreigners who wish to buy goods/services from
that country.
Do you prefer a strong dollar or a weak dollar given the
state of the economy today?