Suppose interest rates in the United States are 5.5%, while they are 3% in the euro area. Currently the dollar-euro exchange rate is at $2.50 per euro. If UIP holds, what do you expect the exchange rate to be in the future? Round to three decimals.

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The Answer of Suppose interest rates in the United States are 5.5%, while they are 3% in the euro area. Currently the dollar-euro exchange rate is at $2.50 per euro. If UIP holds, what do you expect the exchange rate to be in the future? Round to three decimals.

Suppose Interest Rates in the United States Are 5