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Assume the following information: Spot AUD = 0.7200 USD Spot AUD = 0.94 Canadian Dollars Australian Government One Year Yield = 1.6% Australian Inflation Rate

Assume the following information:

Spot AUD = 0.7200 USD

Spot AUD = 0.94 Canadian Dollars

Australian Government One Year Yield = 1.6%

Australian Inflation Rate = 0.8% pa

United States Government One Year Yield = 2.4%

Canadian Inflation Rate = 1.4% pa

Outline how the AUD is likely to change against the USD and the Canadian Dollar in the next year.

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