Task: Conduct independent research in order to form a view regarding current and future market conditions and report your findings explaining your market view. Do you believe that exchange rates will go up or down in the next 3 to 6 months? Explain your thinking behind your conclusion?

One of the following currencies:

1. Australian Dollar (AUD)

2. British Pound (GBP)

3. Canadian Dollar (CAD)

4. Euro (EUR)

5. Japanese Yen (JPY)

6. New Zealand Dollar (NZD)

7. Swiss Franc (CHF)

8. US Dollar (USD)

***Note: Each member must exclusively choose a different currency pair***Market View Guidelines: You can choose any combination from these currencies, so something like AUD/USD or AUD/JPY is acceptable, and so is AUD/USD or JPY/GBP. You are required to analyse what will happen to these exchange rates in the next 3-6 months. Based on the theory that you have learnt in class from topic 4 (exchange rate determination),

Trusted you are required to analyse these exchange rates based on the economic indicators of the respective countries. The indicators you learn in this subject include relative interest rates, relative inflation rates, relative growth rates, government intervention, exchange rate expectations. You may also use other factors such as the current global health crisis (COVID-19 pandemic), geopolitical climate, and the latest news that may affect the exchange rate. It is a good idea to use at least 3 of the economic indicators that you have learnt in class if you want your market view to be strong. For news and market data, you may access Eikon Online, a professional financial data platform used by industry practitioners and experts. You can also use professional magazines, newspapers (see RMIT library e-subscriptions) and financial institutions website (e.g IMF, World Bank, OECD databases and the respective countrys central bank website). Based on your research, you must individually develop a market view and submit it on Canvas. Note that when it says relative, you are required to compare factors relatively e.g., if you are looking at the AUD/USD and you want to analyse interest rates, you must compare Australias interest rate with the US interest rate. In your analysis, if you have looked at a particular indicator you must write why you believe that this indicator will cause a currency to appreciate or depreciate against another. For example, if the interest rate in the US is higher than in Australia and that the interest rate may increase in the US and you believe it will cause the AUD to depreciate against the USD, you need to explain why this causes depreciation. In addition to examining various macroeconomic indicators (often referred to as fundamental analysis), the historical behaviour of exchange rates can also be analysed to predict future behaviour (technical analysis). Once you have completed your analysis, you must state clearly what you believe will happen to the currency pair of your choice. For example, if analysing AUD/USD and you expect the exchange rate to go down, you should state that the AUD would be expected to depreciate against the USD. Keep in mind that currency appreciation or depreciation happens against another currency, so statements like the AUD will appreciate and the AUD/USD will appreciate do not make sense. Note that