Research indicates that currency forecasting services almost always outperform forecasts based on the forward rate.

Question

Quizplus · Accepted Answer

Research generally shows that currency forecasting services do not consistently outperform the market's forward rates in predicting future exchange rates. The forward rate, which is based on interest rate differentials between two currencies, often serves as a benchmark in forecasting, and its predictive accuracy is similar to that of many professional forecasting services.

Research Indicates That Currency Forecasting Services Almost Always Outperform Forecasts