The spot rate for U.S. dollars and Euros is $1.232/€. The 90 day forward rate for the two currencies is $1.254/€. The U.S. dollar

Name: The spot rate for U.S. dollars and Euros is $1.232/€. The 90 day forward rate for the two currencies is $1.254/€. The U.S. dollar
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Question

Quizplus · Accepted Answer

In this question, the U.S. dollar trades at a 90 day forward discount of 1.79%. Since it trades at a forward discount, then the currency is expected to depreciate relative to the Euro, not appreciate.

The Spot Rate for U