26 September 2015 FX Forecasts and Valuations: Don't throw in the towel FX Behavioral and Fundamental Equilibrium Exchange Rates (BEER and FEER)' 'Figure 1: USD-cross BEER and FEER valuations. TVVI PPP valuations 30 19 20 in 10 7 7 13 8 10 1° 11 33 0 . ••• 24 1 4 0 -10 - • -5 -8 -8 -$ -10 -20 -30 , ■ BEER -40 • FEER •REER vs 10y average O 26 • ■ 21 26 10 14 -24 -25 -25 -26 -26 .27 -28 -28 -29 -31 9 n a. a cc Fa ok i2E5B 0 4T 2Fcz >- "E SOUP.' DI FX Romeo% Oseeenem, licanbey Nwwwel LI 47 47 49 -39 13 cel 2 c%> = z a E 6 22 19 15 -42 co a. 0 >- cc u [Figure 2. EURIUSD is cheap vs. BEER FV 1.8 1 1.6 I 1.4 1.2 1.0 • 0.8 0.6 I 80 83 86 89 92 95 98 01 04 07 10 1.3 15 EUR BEER Fair Value —Spot Sant DO FXSisiven Page 16 Figure 3: USDIJPY is above fair value vs. BEER FV M.0' in BEER Fair Value 250.0 200.0 150.0 • 1000 —Spot 50.0 80 83 86 89 92 95 98 01 04 07 10 13 15 ..... Sown FX Anal Deutsche Bank Securities Inc. CONFIDENTIAL - PURSUANT TO FED R CRIA1 P. 6(e) DB-SDNY-0118614 CONFIDENTIAL SDNY_GM_00264798 EFTA01458619