What is best estimate of one year forward exchange premium

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Reference no: EM131278488

Suppose that in Japan the interest rate is 8% and inflation is expected to be 3%.

Meanwhile, the expected inflation rate in France is 12%, and the English interest rate is 14%.

To the nearest whole number, what is the best estimate of the one-year forward exchange premium (discount) at which the pound will be selling relative to the euro?

Reference no: EM131278488

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