Fisher Effect is a term used in finance for forecasting the movement of currency exchange rate in the future. The core idea of this term is the expected exchange rate between two countries should be approximately equivalent to the difference between the nominal interest rates of two countries. This term can be expressed as formula as E = i1-i2 which “E” stand for the exchange of the currency exchange rate, i1 and i2 stand for the interest rate of the country A and country B respectively. A detail explanation of this term would be: a country that has a higher interest rate should have a higher inflation rate compare with the country that has a lower interest rate. Because there is a decreased of the real value on the goods from country that has a higher inflation rate, at the same time the higher inflation rate causes depreciation against to the one has a lower interest rate 
One example involves the international Fisher Effect which can be if U.S. has a nominal interest rate 5%, the Germany has an interest rate of 7%, then the exchange of the currency exchange rate would be 2%, which means the currency of Germany should be appreciation 2%. Since the currency is a “one side wins, one side loss” game, it requires that the U.S. dollar to deprecate 2 %. 
Currently, U.S. dollar has been weak against Euro since the GDP data reduced the greenbacks safe-haven appeal. One reason that caused this situation could be explained by the change of the saving rates. Since the depreciation from 2007, the saving rate of Americans expect to increased to 6% to 10% at the end of 2009, and the interest rate is continually dropping because of the high saving rate. Right now, the low interest rate in America has pushed the U.S. dollar to become depreciated against the Euros due to the Fisher Effect.

Reference:

http://www.businessweek.com/investor/content/oct2009/pi20091029_272575.htm