What should the euro and the australian dollar exchange rate

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Reference no: EM131174759

Assume that one-year interest rates are 4.40% in Australia and 3.75% in the euro-zone.

The spot rate between the euro and the Australian dollar is €0.8250/A$.

Assuming that the international Fisher effect holds, what should the€/A$ exchange rate be one year hence?

Reference no: EM131174759

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