A United States–based company trades extensively with various countries in the eurozone (these countries use the euro). You have been hired as a consultant to evaluate the impact of currency...

Daily exchange rates between the Euro and the United States Dollar (USD) – 1st Oct till 31st Dec, 2020
Introduction
It is the currency of one nation in comparison to the currency of another nation (James Chen, 2020). It helps us to determine the number of US dollars that can be purchased or sold based on one Euro. We have considered the exchange rate of Euro to USD from 1st October 2020 to 31st December 2020. Based on this we found that the Euro to USD is €1.2216 against $1 USD. This means Euro is more than USD in December 2020. Based on the demand and supply in the market of the countries the exchange rate fluctuates and is mostly free floating. Some currencies are also restricted or pegged. But, Euro is not a pegged (remain within a specific range) to any currency. Euro is the second largest currency to US dollars traded globally. The exchange risk is reduced for all the 17 countries in the Eurozone due to Euro.
Analysis
Inputs Considered for calculation of Euro to US Dollar
The tool used is Dr. Antweiler’s FC Charts & Plots in order to calculate and design the exchange rate chart of Euro to USD. The Base currency which is considered for the plotting of the graph is in terms of European Euro while the target currency is US Dollars (USD). The chosen time horizon is 91 days or 3 months. This is as per the requirement of the analysis of the exchange rate. The date of commencement considered for the illustration of the diagram of exchange rate of Euro to USD is 1st October, 2020 till 31st December, 2020. The data frequency used in this process is on a daily basis and the notation that is considered for this issue is volume notation. In this case, the moving average curve considered is the 90-day curve and the changes of the same are reflected on a daily basis.
Exchange Rate Table and Estimation
    Date
    Euro/ USD Rate
    01-10-2020
    1.1745
    08-10-2020
    1.1763
    15-10-2020
    1.1706
    24-10-2020
    1.1863
    31-10-2020
    1.1678
    02-11-2020
    1.1641
    09-11-2020
    1.1815
    17-11-2020
    1.1864
    25-11-2020
    1.1915
    30-11-2020
    1.1932
    01-12-2020
    1.2073
    08-12-2020
    1.2105
    15-12-2020
    1.2153
    25-12-2020
    1.2192
    31-12-2020
    1.2216
The Euro to USD is although fluctuating yet it is in upward trend till end of December 2020. It can be observed that there was a slow increase in the Euro against USD from October, 2020 onwards.
Euro to USD increased in October, 2020 to 1.1863, fell in 2nd November, 2020 to 1.164, raised again in 6th November to 1.1874 and went increasing from there onwards.
On 31st December, 2020 it was discovered that the Euro to USD was 1.2216. This is a situation of a strong Euro against USD.
Reason for fall in Euro to US dollars
There were several reasons due to which the Euro was weak or strong compared to the US dollar during the period of 1st October, 2020 till 31st December, 2020 which is the phase of...