Question 2 The following wholesale exchange rates are taken from Oanda.com on September 21, 2020. Currency Pair AUD/USD Bid Ask 0.7306 0.7307 AUD/JPY AUD/CAD AUD/NZD 76.25 76.32 0.9626 0.9634 1.0781...

Question 2<br>The following wholesale exchange rates are taken from Oanda.com on September 21, 2020.<br>Currency Pair<br>AUD/USD<br>Bid<br>Ask<br>0.7306<br>0.7307<br>AUD/JPY<br>AUD/CAD<br>AUD/NZD<br>76.25<br>76.32<br>0.9626<br>0.9634<br>1.0781<br>1.0795<br>AUD/CHF<br>0.6648<br>0.6653<br>The forward quotes in point form are as follows for the currency pairs AUD/USD and<br>AUD/CHF as of September 21, 2020.<br>Currency<br>1-month forward<br>3-month forward<br>1-year forward<br>Pair<br>points<br>points<br>points<br>Bid<br>Bid<br>Ask<br>Bid<br>Ask<br>Ask<br>AUD/USD<br>AUD/CHF<br>0.6000<br>0.7000<br>2.000<br>2.3000<br>4.000<br>5.5000<br>-6.4000<br>-6.2400<br>-16.9000<br>-16.5200<br>-70.5000<br>-68.5000<br>d) Calculate the outright forward rates for the currency pair AUD/CHF.<br>e) Calculate the outright forward rates for the currency pair AUD/USD.<br>f) Calculate the forward premium (discount) based on the rates calculated in e) above.<br>g) Do the forward rates imply a strengthening or weakening of the USD with respect to the<br>Australian dollar? Explain your logic.<br>

Extracted text: Question 2 The following wholesale exchange rates are taken from Oanda.com on September 21, 2020. Currency Pair AUD/USD Bid Ask 0.7306 0.7307 AUD/JPY AUD/CAD AUD/NZD 76.25 76.32 0.9626 0.9634 1.0781 1.0795 AUD/CHF 0.6648 0.6653 The forward quotes in point form are as follows for the currency pairs AUD/USD and AUD/CHF as of September 21, 2020. Currency 1-month forward 3-month forward 1-year forward Pair points points points Bid Bid Ask Bid Ask Ask AUD/USD AUD/CHF 0.6000 0.7000 2.000 2.3000 4.000 5.5000 -6.4000 -6.2400 -16.9000 -16.5200 -70.5000 -68.5000 d) Calculate the outright forward rates for the currency pair AUD/CHF. e) Calculate the outright forward rates for the currency pair AUD/USD. f) Calculate the forward premium (discount) based on the rates calculated in e) above. g) Do the forward rates imply a strengthening or weakening of the USD with respect to the Australian dollar? Explain your logic.

Jun 10, 2022

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Question 2 The following wholesale exchange rates are taken from Oanda.com on September 21, 2020. Currency Pair AUD/USD Bid Ask 0.7306 0.7307 AUD/JPY AUD/CAD AUD/NZD 76.25 76.32 0.9626 0.9634 1.0781...

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