You will analyze movements in the exchange rate for a currency pair

You will analyze movements in the exchange rate for a currency pair. You may choose any pair of currencies where you can find data for at least one year. You may want to choose a pair that you are familiar with from work or from your own personal experience.

You will analyze movements in the exchange rate for a currency pair

Firstly, you will analyze movements in the exchange rate for a currency pair.

Secondly, you may choose any pair of currencies where you can find data for at least one year.

Thirdly, you may want to choose a pair that you are familiar with from work or from your own personal experience.

Fourthly, you could start looking for data on websites such as Bloomberg or XE.com.

In a word-processed document of no more than 1000 words, your report should include a clearly labelled graph of the currency pair and analysis of their performance over the past year including:

Discussion of any trade or interest rate factors.

Description of economic conditions and forecasts.

Analysis of the reasons for any changes.

You should also include an Excel file with the underlying data and the calculations (not just the numbers) that you performed. In this Excel file, you should empirically test the theories covered in our course (Absolute PPP, Relative PPP and Interest Rate Parity) and analyze how well they apply (or don’t apply) to this currency pair. This means you will try to fit actual numbers to the theories to see if the theories predictions match what actually happened to the currency pair.

Make sure to properly reference all of your sources and clearly justify any assumptions. This is the research-based assignment and you need to conduct some research. It carries 45 marks so the quality of your submission matters a lot.

Note:

Plagiarism will not be tolerated at all.
Please review the attached grading rubric prior to starting the assignment so you know how marks will be awarded.

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