the 1 year forward rate on the mexican peso is 00451 mxn but the curre
Question
The 1 year Forward rate on the Mexican Peso is $0.045/1 MXN but the current spot rate on the Mexican Peso is $0.049/1 MXN. How is it possible that the bank can offer to sell Mexican Peso in one year for less than what the Mexican Peso is worth today?