I found this formula to find fair value of a forex pair:
FV = Spot × e(local interest rate−foreign interest rate) × T
Taken for example AUDUSD,
Spot is AUD per USD.
T is the time to maturity of the contract (in years). So for example if the contract expires in 1 year and a half, T=18/12=1.5.
But, local interest rate and foreign interest rate? Are they respectively AUD(local) and USD(foreign)?