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QUESTION
Spot rate DKK 6.8911/$` 12-month forward rate DKK 6.9866/$ Inflation in US 2.0 percent/year Inflation in Denmark 4.4 percent/year Interest rate in US...
Spot rate DKK 6.8911/$`
12-month forward rate DKK 6.9866/$
Inflation in US 2.0 percent/year
Inflation in Denmark 4.4 percent/year
Interest rate in US 3.2 percent/year
Interest rate in Denmark 5.5 percent/yearÂ
Question : Forecast the outright value of DKK for next year on the basis of the International Fisher effect.
