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Suppose the spot and three-month forward rates for the yen are $108.46 and #107.13, respectively. a. Is the yen expected to get stronger or weaker?
Suppose the spot and three-month forward rates for the yen are $108.46 and #107.13, respectively. a. Is the yen expected to get stronger or weaker? b. What would you estimate is the difference between the inflation rates of the United States and Japan? (A negative answer should be indicated by a minus sign. Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) Stronger a. Yen expected to get b. Difference between the inflation rates
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