Discussion:
This question will make you explore the GBP / USD exchange rate relationship in this year.
a) Figure out the average spot rate for these 2 currencies for November 30th, 2016 and November 30th 2017 (Cite the source - make sure it is a reliable one). Then calculate to the second decimal place in percentage terms how much:
i. USD has appreciated or depreciated.
ii. GBP has depreciated or appreciated.
b) What is the 1 month and the 6 month forecast for this pair's exchange rate? Which currency is becoming stronger and by what %? (Cite the source - make sure it is a reliable one)
c) What factors in the next 6 months do you think would impact the exchange rate and could make it different from what you cited in part (b)?