Assume that 90-day U.S. securities have a 2.9% annualized interest rate, whereas 90-day Canadian securities have a 3.2% annualized interest rate. In the spot market, 1 U.S. dollar can be exchanged for 1.25 Canadian dollars. If interest rate parity holds, what is the 90-day forward rate exchange between U.S. and Canadian dollars (in terms of Canadian dollars per U.S. dollar)? C$ 1.1258/$1 C$ 1.2509/$1 C$ 1.3760/$1 C$ 1.5637/$1 C$ 1.6637/$1

Assume that 90-day U.S. securities have a 2.9% annualized interest rate, whereas 90-day Canadian securities have a 3.2% annualized interest rate. In the spot market, 1 U.S. dollar can be exchanged for...

Jun 05, 2022