Homework answers / question archive / If the Spot rate of EGPJPY is 6

If the Spot rate of EGPJPY is 6

Finance

Share With

If the Spot rate of EGPJPY is 6.65 and the forward rate is 6.89. You are also given that the EGP interest rate is 8.25%, whereas the JPY interest rate is 8.59%. Compare the interest and exchange rates agios. State whether there is an arbitrage opportunity based on your calculation or not. (Round to two decimals)