Foreign Exchange Swap
/ˈfɔːrɪn ɪksˈtʃeɪndʒ swɒp/
Definitions
- (n.) A financial agreement between two parties to exchange currencies for a specified period and reverse the exchange at a later date on agreed terms.
The bank entered into a foreign exchange swap to manage its currency risk exposure.
Forms
- foreign exchange swap
- foreign exchange swaps
Related terms
See also
Commentary
Typically used to manage short-term foreign currency liquidity or hedge exposure; agreements should clearly specify amounts, rates, and maturities to avoid disputes.
This glossary is for general informational and educational purposes only. Definitions are jurisdiction-agnostic but reflect terminology and concepts primarily drawn from English and American legal traditions. Nothing herein constitutes legal advice or creates a lawyer-client relationship. Users should consult qualified counsel for advice on specific matters or jurisdictions.