A forward discount on Mexico's peso serves as a rough benchmark of the expected appreciation in the peso's spot rate.

Question

Quizplus · Accepted Answer

A forward discount on Mexico's peso does not necessarily serve as a benchmark for the expected appreciation in the peso's spot rate. The expected appreciation or depreciation of a currency's spot rate can be influenced by various factors such as changes in interest rates, economic fundamentals, political events, and market sentiment.

A Forward Discount on Mexico's Peso Serves as a Rough