Euro and Foreign exchange swap: Difference between pages

Revision as of 11:05, 29 November 2014

A transaction which solely involves:

(A) An exchange of two different currencies

on a specific date
at a fixed foreign exchange rate which is pre-agreed at the outset of the contract; and

(B) A reverse exchange of the same two currencies

on a later pre-specified date
at a fixed exchange rate which is usually different and which is also pre-agreed at the outset of the contract.

The uses of foreign exchange swap contracts include the transformation of short term borrowings or deposits from one currency into another.

Not to be confused with a Swap, which is different.

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-{{lowercase}}
+A transaction which solely involves:
-#A prefix meaning that currency is held in a different jurisdiction from its country of origin. For example eurodollar or euroyen or, more generally, eurocurrencies.
-#Established by the 1992 Treaty on European Union (TEU, better known as the Maastricht treaty) the euro is the official currency of the European Union. Note that the currency takes lower case except where a capital is grammatically or stylistically required, for example, at the start of a sentence. The ISO (three letter) currency code for the euro is EUR.
+(A) An exchange of two different currencies
+#on a specific date
+#at a fixed foreign exchange rate which is pre-agreed at the outset of the contract; and
+(B) A reverse exchange of the same two currencies
+#on a later pre-specified date
+#at a fixed exchange rate which is usually different and which is also pre-agreed at the outset of the contract.
+The uses of foreign exchange swap contracts include the transformation of short term borrowings or deposits from one currency into another.
+Not to be confused with a [[Swap]], which is different.
 == See also ==
-* [[euro]]
+* [[Foreign exchange]]
-* [[Eurobond]]
+* [[Swap]]
-* [[Offshore]]
+* [[CertICM]]
+[[Category:Manage_risks]]