Based on the following spot and forward rates, find the 1-month, 3-months, and 6-

months forward premium or discount for euro and UK pounds (SHOW

YOUR CALCULATION). What is the market expectation of the future movement

of euro and UK pounds based on the 1-month, 3-months, and 6-months

forward premium/discount?

Euro UK pound

Spot rate $1.1135 $1.4275

1-month forward $1.1142 $1.4236

3-months forward $1.1148 $1.4258

6-months forward $1.1153 $1.4251