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The JPY/AUD spot exchange rate is 82.42, the JPY interest rate is 0.15%, and the AUD interest rate is 4.95%. What is the equilibrium forward
The JPY/AUD spot exchange rate is 82.42, the JPY interest rate is 0.15%, and the AUD interest rate is 4.95%. What is the equilibrium forward rate in JPY/AUD?
1. Borrow 1 AUD and exchange it for ___________________JPY.
2. Save JPY in the bank, and get __________________ JPY after one year.
3. In equilibrium, ____________ JPY = ___________ AUD.
4. The equilibrium forward rate is _______________ JPY/AUD.
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