reverse swap

Reverse Swap

A swap that restores an earlier position. For example, one may swap U.S. dollars for British pounds when doing so is advantageous to one's investment strategy, then reverse swap the pounds back to dollars when that becomes advantageous.

reverse swap

The exchange of one bond for another such that an earlier investment position is reestablished to the investment position that existed before an earlier swap. For example, an investor might swap intermediate-term bonds for long-term bonds to take advantage of a steeply sloped yield curve. As the yield curve flattens, the investor might engage in a reverse swap by exchanging the long-term bonds for intermediate-term bonds.
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Indirect policy instruments include sale of CBO CDs to absorb excess liquidity, repo operation to inject liquidity in domestic currency and swap and reverse swap operation for lending in foreign currency to the domestic commercial banks as and when required.
Russia is in talks with Iran to set up a reverse swap formula to convey its Southern oil to the Caspian Sea, so that the Russian tankers would be able to take it to nearby oil terminals.
48bn in reverse swap contracts on offer, the seventh reverse swap auction held by the central bank so far this year, reports Dow Jones.
At a reverse swap auction on February 10, the central bank has sold 86 percent of contracts offered, worth USD855.
Reverse swap auctions enable investors to exchange futures positions in US dollars for positions linked with domestic interest rates.
The required reserves ratio has been reduced by three percentage points to 5%, a US dollar reverse swap facility introduced, and around USD2 billion made available for a lending scheme under which banks unable to secure foreign credit lines are able to borrow directly from thecentral bank.
The event has attracted huge media attention and is the first half of a series which will see the speedway riders travel to Donnington Park to carry out the reverse swap later in the season.
5 percent of reverse swap contracts(C)2011 ENPublishing - http://www.
5 percent of reverse swap contracts offered at an auction on Tuesday, equal to USD1.
Global Banking News-January 17, 2011--Brazil central bank sells contracts in reverse swap auction(C)2011 ENPublishing - http://www.
4 percent, using seven-day reverse swaps, reports Bloomberg.