Question: Using Exhibit 5.7, calculate the one-, three-, and six-month forward premium or discount for the Japanese yen versus the U.S. dollar using American term quotations.

Using Exhibit 5.7, calculate the one-, three-, and six-month forward premium or discount for the Japanese yen versus the U.S. dollar using American term quotations. For simplicity, assume each month has 30 days. What is the interpretation of your results?

Note: Round your answers to 5 decimal places.

Exhibit 5.7

Exchange Rates

Currencies January 31, 2022
U.S.-dollar foreign-exchange rates in late New York trading
Country/ Currency Monday
In US$ Per US$
Americas
Argentina peso 0.0095 105.02
Brazil real 0.1883 5.3102
Canada dollar 0.7869 1.2708
Chile peso 0.001249 800.60
Colombia peso 0.000254 3942.5
Costa Rica colon 0.001556 642.73
Ecuador US dollar 1 1
Mexico peso 0.0485 20.635
Peru new sol 0.2601 3.845
Asia-Pacific
Australian dollar 0.7067 1.4150
1-mos forward 0.7068 1.4149
3-mos forward 0.7071 1.4143
6-mos forward 0.7077 1.4131
China yuan 0.1572 6.3612
Hong Kong dollar 0.1283 7.7974
India rupee 0.01340 74.622
Indonesia rupiah 0.0000696 14368
Japan yen 0.00869 115.11
1-mos forward 0.00869 115.09
3-mos forward 0.00870 114.98
6-mos forward 0.00872 114.70
Malaysia ringgit 0.2389 4.1855
New Zealand dollar 0.6576 1.5206
Philippines peso 0.01962 50.975
Singapore dollar 0.7400 1.3513
South Korea won 0.0008268 1209.5
Taiwan dollar 0.03593 27.835
Thailand baht 0.03009 33.238
Vietnam dong 0.00004 22649.7
Europe
Czech Rep. koruna 0.04616 21.666
Denmark krone 0.1499 6.6708
Euro area euro 1.1235 0.8901
1-mos forward 1.1241 0.8896
3-mos forward 1.1260 0.8881
6-mos forward 1.1299 0.8851
Hungary forint 0.00316 316.19
Norway krone 0.1124 8.8963
Poland zloty 0.24515 4.0791
Russia ruble 0.01293 77.312
Sweden krona 0.1073 9.3230
Switzerland franc 1.0785 0.9272
1-mos forward 1.0793 0.9265
3-mos forward 1.0815 0.9247
6-mos forward 1.0857 0.9211
Turkey lira 0.0752 13.304
UK pound 1.3447 0.7437
1-mos forward 1.3444 0.7438
3-mos forward 1.3441 0.7440
6-mos forward 1.3435 0.7443
Middle East/Africa
Bahrain dinar 2.6527 0.3770
Egypt pound 0.0636 15.722
Israel shekel 0.3159 3.1653
Jordan dinar 1.4105 0.7090
Kuwait dinar 3.3002 0.3030
Nigeria naira 0.00241 415.26
Saudi Arabia riyal 0.2665 3.7519
South Africa rand 0.0650 15.387
UAE dirham 0.2723 3.6730

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