Foreign exchange swap

(redirected from Cross-Currency Swaps)

Foreign exchange swap

An agreement to exchange stipulated amounts of one currency for another currency at one or more future dates.

Foreign Exchange Swap

An agreement between two parties to exchange two currencies at a certain exchange rate at a certain time in the future. For example, if a company knows that it will need British pounds in the future and another company knows that it will need U.S. dollars, they agree to swap the two at the agreed-upon exchange rate. This eliminates the risk that the exchange rate will change in a way that is disadvantageous to one party or the other. They are also called currency swaps. See also: Swap.
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AIIB has plans to expand the operations it can support by analyzing, piloting, and building up local currency capabilities, both in terms of cross-currency swaps as well as capital market borrowings," said Ostfield.
Cross-currency swaps are being increasingly used to offset both exchange rate and interest rate risks with daily global transactions in the range of $50bn to $60bn.
The debt practitioners debated issues such as Currency Choice in International Bond Markets, Using Cross-Currency Swaps to Manage the Cost and Risk Profile of Public Debt Portfolios, Innovative Financial Instruments: What is the Promise for Public Debt Managers?
His team works with clients to design effective hedging strategies, utilizing foreign exchange options and cross-currency swaps.
some have turned to cross-currency swaps to hedge that exposure, Gaylor said.
Deutsche Bank also says that it launched the first investable CNH bond index, and was among the first to execute onshore RMB FX option trades, CNH cross-currency swaps, and CNH forwards.
FX benchmark rates, such as the WM/R Rates, are used for pricing of cross-currency swaps, foreign exchange swaps, spot transactions, forwards, options, futures and other financial derivative instruments.
Forward rate agreement (FRA) volumes dropped by 10%, while there was a rise of 9% in the volume of foreign exchange swaps and an 8% rise in cross-currency swaps.
It is currently working on standards for cross-currency swaps, foreign exchange forwards and collateralized murabaha, while also consulting on credit support arrangements in Islamic finance contracts, said Alvi.
It is currently working on standards for cross-currency swaps, foreign exchange forwards and collateralised murabaha, while also consulting on credit support arrangements in Islamic finance contracts, said Alvi.
Cross-currency swaps: A cross-currency swap is a foreign exchange swap that also involves the exchange of streams of interest payments in different currencies for an agreed period of time.
Cross-currency swaps are complicated derivative instruments that require a deep understanding of multiple nuanced markets.