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The spot rate today of the Swiss franc (SF) in dollars is $0.40/SF. The spot rate of the Mexican peso (MP) in dollar is $0.20/MP.
The spot rate today of the Swiss franc (SF) in dollars is $0.40/SF. The spot rate of the Mexican peso (MP) in dollar is $0.20/MP. Suppose that a forecaster predicts that the dollar will appreciate 20% against the peso and depreciate 20% against Swiss franc. What percentage appreciation or deprecation is the forecaster predicting for the franc in terms of pesos (what percent change in the MP/SF exchange rate is he predicting)?
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