Calculate the 90-day AUD/USD forward rate, for the case that the current spot rate is AUD/USD 0.9425 and the interest rate in the US is 4% and in Australia 2%.

Solutions

Expert Solution

Current Spot Rate = 0.9425 AUD per USD

Calulating the 90-day Forward rate:-

where, n = no of days = 90 days

Forward rate = 0.9378 AUD per USD

So, the 90-day AUD/USD forward rate is 0.9378

jeff jeffy answered 2 years ago

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