The theory that states that the current forward rate is an unbiased predictor of the expected future spot rate is called

Question

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Uncovered interest rate parity theory states that the current forward rate is an unbiased predictor of the expected future spot rate. The international Fisher effect states that the difference in nominal interest rates between two countries will be reflected in an equal but opposite change in their exchange rate. Purchasing power parity theory states that the exchange rate between two countries should equal the ratio of the two countries' price levels. Covered interest rate parity theory states that the forward exchange rate should reflect the interest rate differential between two countries, adjusted for the cost of hedging the foreign currency exposure. The theory that states that the current forward rate is an unbiased predictor of the expected future spot rate is called uncovered interest rate parity. This theory suggests that the difference in interest rates between two currencies will be offset by the movement in the exchange rate over time. It assumes that investors are indifferent between investing in one currency or another and that there are no restrictions on the movement of capital between countries.

The Theory That States That the Current Forward Rate Is