Fight Finance

Courses  Tags  Random  All  Recent  Scores

Scores
keithphw$5,721.61
Visitor$980.00
Gisele$936.78
aurora$629.43
Visitor$464.00
Visitor$460.00
Visitor$410.00
Visitor$400.00
Visitor$390.00
Visitor$310.00
Visitor$250.00
Visitor$247.00
Visitor$220.00
Visitor$220.00
lukeh$199.09
Visitor$190.00
Visitor$190.00
Visitor$170.00
Visitor$170.00
Visitor$160.00
 

Question 891  foreign exchange rate, monetary policy, no explanation

Suppose the market expects the Bank of Japan (BoJ) to decrease their short term interest rate by 15 basis points at their next meeting. The current short term interest rate is -0.1% pa and the exchange rate is 100 JPY per USD.

Then unexpectedly, the BoJ announce that they will leave the short term interest rate unchanged.

What do you expect to happen to Japan’s exchange rate on the day when the surprise announcement is made? The Japanese Yen (JPY) is likely to suddenly:




Copyright © 2014 Keith Woodward