JPMorgan Chase generates the following set of forecasts for the future spot exchange rate (Figures 1 and 2): Figure 1: US$/ $1.40 1.38- 1.32 1.32 1.30 $1.30 1.27 1.26 1.23. Actual Spot 1.21 $1.20 Rate 1.22 23 1.23 1.17 1.19 1.19 1.15, 1.16 1.13 $1.10 1.07 1.02 $1.00 0.98 1.00 1.01 $0.90 0.91 JPMC's forecast of the spot rate 90 days into the future. 0.90 0.87 $0.80 Figure 2: Japanese Yen per V/S 138 U.S. Dollar 136 133 2/14/02 5/16/02 8/08/02 11/07/02 2/13/03 5/15/03 131 126.4 128 126 126 122.3 121 121.3 8/14/03 11/13/03 2/12/04 JPMC's forecast of the spot rate 90 days into the future 5/13/04 8/19/04 11/20/04 3/1/05 5/24/05 121 119 120 118 116 116 116.3 117 113 111 108 Actual Spot 108.7 Rate 105.7 106 106 105 101 101 104 28 105 104 96 96 2/14/02 5/16/02 8/08/02 11/07/02 2/13/03 5/15/03 8/14/03 11/13/03 2/12/04 5/13/04 8/19/04 11/20/04 3/1/05 5/24/05