For example, suppose a U.S.-based company needs to acquire Swiss francs and a Swiss-based company needs to acquire U.S. dollars. These two companies could arrange to swap currencies by establishing an interest rate, an agreed upon amount and a common maturity date for the exchange. Currency swap maturities are negotiable for at least 10 years, making them a very flexible method of foreign exchange.
Currency swaps were originally done to get around exchange controls.
Investment dictionary. Academic. 2012.
Look at other dictionaries:
currency swap — An agreement under which two parties agree to exchange or swap specific amounts of two different currencies and repay over time with payments based on fixed interest rates in each currency. Practical Law Dictionary. Glossary of UK, US and… … Law dictionary
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Currency swap — An agreement to swap a series of specified payment obligations denominated in one currency for a series of specified payment obligations denominated in a different currency. The New York Times Financial Glossary * * * currency swap currency swap… … Financial and business terms
currency swap — An agreement to swap a series of specified payment obligations denominated in one currency for a series of specified payment obligations denominated in a different currency. Usually fixed for fixed. Bloomberg Financial Dictionary * * * currency… … Financial and business terms
currency swap — A swap in which specified amounts of one currency are exchanged for another currency at agreed principles over time. In an ordinary currency swap both currencies bear interest at a fixed rate: if both currencies bear interest at a floating rate… … Big dictionary of business and management
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currency swap — / kʌrənsi swɒp/ noun an agreement to use a certain currency for payments under a contract in exchange for another currency (the two companies involved can each buy one of the currencies at a more favourable rate than the other) … Dictionary of banking and finance
currency swap — exchange of currencies of different countries … English contemporary dictionary
Cross currency swap — A cross currency swap, also referred to as cross currency interest rate swap or simply currency swap, is an agreement between two parties to exchange interest payments and principals denominated in two different currencies. Contents … Wikipedia
Dual Currency Swap — A currency swap used to hedge the risk associated with the issuance of a dual currency bond. A dual currency swap allows the bond issuer to repay the principal and coupon in the base currency or another currency. Exchange rates are preset in dual … Investment dictionary