Forward foreign exchange rate: Difference between revisions
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The agreed exchange rate on the day a transaction is entered into for a foreign currency transaction that settles more than two days in the future. | The agreed exchange rate on the day a transaction is entered into, for a foreign currency transaction that settles more than two days in the future. | ||
The rate is determined by adjusting the spot rate to reflect the interest rate differential between the two currencies involved for the forward period. | The rate is determined by adjusting the spot foreign exchange rate, to reflect the interest rate differential between the two currencies involved for the forward period. | ||
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* [[Foreign exchange rate]] | * [[Foreign exchange rate]] | ||
* [[Forward points]] | * [[Forward points]] | ||
* [[FX]] | |||
* [[Interest rate parity]] | |||
* [[Spot rate]] | |||
[[Category:Manage_risks]] | [[Category:Manage_risks]] | ||
Latest revision as of 20:28, 28 April 2016
The agreed exchange rate on the day a transaction is entered into, for a foreign currency transaction that settles more than two days in the future.
The rate is determined by adjusting the spot foreign exchange rate, to reflect the interest rate differential between the two currencies involved for the forward period.
