Essay BAFN205 – Financial Instruments & Institutions – Finance Assignment Help

Assignment Task

Task 1 

Construct the term structure of interest rates using Commonwealth Government Securities on the following dates: • 28 April 2021 • 28 April 2020 You can use data available from the Reserve Bank of Australia (https://www.rba.gov.au/statistics/tables/#interest-rates). Based on the term structure of interest rate you have constructed for above dates, please provide commentary on which way Australian economy is leading into and how the shape of the yield curve is differing on those two dates. (Max 100 words along with the term structure of interest rates)

Task 2 a) Construct exchange rate plots for AUD/CNY, AUD/EUR, and AUD/USD from 1 January 2020 to 28 April 2021 using data from the RBA and provide commentary on how AUD/CNY, AUD/EUR, and AUD/USD are behaving in the context of COVID-19 crisis.

 b) Explain how the RBA manages the Australian exchange rate regime in the context of the COVID–19 pandemic. Also, relate your discussion on how the RBA manages the exchange rate regime to the International Monetary Fund’s classification of the exchange rate regime.

Task 3 Commonwealth Bank of Australia (CBA) is a deposit-taking institution (ADI) regulated by the Australian Prudential Regulation Authority (APRA) under the authority of the Banking Act, 1959. Following the prudential regulation standards (e.g., APS Capital Adequacy, APS111 Capital Adequacy: Measurement of Capital), CBA manages its capital. Explain how CBA is meeting the regulatory requirement of the APRA.