Question
Q) The currency pair of the spot CHF/$ is 1.4723, while the three-month interest rates are 1.80 per cent for the U.S. dollar (7.2% annualized)
Q) The currency pair of the spot CHF/$ is 1.4723, while the three-month interest rates are 1.80 per cent for the U.S. dollar (7.2% annualized) and 0.95 per cent for the CHF (3.8% annualized).
Suppose foreign exchange market participants are risk-neutral. What is the implied market prediction for the three-month ahead CHF/$ exchange rate?
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Finance For Growing Enterprises
Authors: Edward W. Davis, Roger Buckland
1st Edition
1138679941, 978-1138679948
