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Determine the historical movement of AUD/USD exchange rate and predict what the rate will be in 1 Jan 2021 (1) Discuss the effect of Purchasing

Determine the historical movementofAUD/USDexchange rate and predictwhat the rate will be in 1 Jan 2021

(1) Discuss the effect of Purchasing Power Parity and Interest Rate Parity on exchange rates.

(2) Discuss the factors which affect supply and demand of exchange rates.

(3) Develop your own theoretical model by combining any factors that you deem as important in determining the above exchange rate. You will need to estimate an econometric model to receive credit for this part.

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