Which of the following is NOT a method of forecasting exchange rates?
A)using the forward rate for a currency to predict the future spot rate
B)using a time-series model that examines moving averages and allows the forecaster to identify patterns in a currency's movements
C)using the volatility of future exchange rate movements
D)examining current values for economic variables along with their historical impact on a currency's value

Question

Quizplus · Accepted Answer

Using the volatility of future exchange rate movements is not a method of forecasting exchange rates. Forecasting typically involves analyzing patterns, economic variables, or market expectations rather than relying on the concept of volatility alone, which is more about measuring the degree of variation in exchange rate movements over time without providing a specific directional prediction.

Which of the Following Is NOT a Method of Forecasting