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Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA AFM Exams › forecast foreign exchange rates
forecast foreign exchange rates( the relationship between interest, inflation, spot and forward rates)
– i’m not sure how we can get the expected spot rate for the future using( forward rate spot rate)
– Does it mean that if we multiply spot rate x ( forward rate / spot rate ) = expected future spot rate ??????
I explain all of this in detail, with examples, in my lectures on foreign exchange risk management.
Forward rates are certainly not expected future spot rates!!
