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The GBP/USD spot is 1.350 and the 1-year forward is 1.370. The EUR/USD spot is 1.200 and the 1-year forward is 1.190. The 1-year interest

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The GBP/USD spot is 1.350 and the 1-year forward is 1.370. The EUR/USD spot is 1.200 and the 1-year forward is 1.190. The 1-year interest rates are 4.50% for GBP 3.50% for USD, and 3.00% for EUR. What is the best transaction option below with a covered interest hedge (ie. 1-yr forward FX contract? Borrow GBP and deposit USD Borrow USD and deposit GBP. Borrow EUR and deposit USD Borrow USD and deposit EUR

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