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If the interest rate in the US is 6% and in the UK is 5% and interest rate parity (IRP) holds, is the forward premium

  1. If the interest rate in the US is 6% and in the UK is 5% and interest rate parity (IRP) holds, is the forward premium for the dollar per pound positive or negative?
    1. Does the market expect the dollar to depreciate or appreciate relative to the pound?

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