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Forward Contract Rate Calculator

Work out forward contract rate instantly with clear inputs, formula shown and shareable results.

About Forward Contract Rate Calculator

Forward rates are derived from the interest differential using continuous compounding, not from any forecast. The higher-rate currency trades at a forward discount because holding it already earns more interest.

Formula

Forward rate

F = S × e^((r_domestic - r_foreign) × t)

S
Spot rate
t
Years to maturity

Worked example

With the default values below, Forward Contract Rate Calculator returns Forward Rate of 83.7648. Change any input above and every figure here is recalculated in your browser.

Inputs used

Spot Rateaccepts 0–100,000
83.25
Domestic Interest Rateaccepts 0–100 %
7 %
Foreign Interest Rateaccepts 0–100 %
4.5 %
Days To Maturityaccepts 1–1,095
90

Results

Forward Rate
83.7648
Forward Points
0.5148
Premium Over Spot
0.6183%
Annualised Premium
2.5077%

Step by step

  1. 1Values used
  2. 2Forward rate
  3. 3Forward Rate= 83.7648
  4. 4Forward Points= 0.5148
  5. 5Premium Over Spot= 0.6183
  6. 6Annualised Premium= 2.5077

Assumptions and limits

  • The result is derived only from the 4 inputs listed above. Anything not among them is not part of the calculation.
  • In particular, this calculator does not take inflation, tax, fees or charges or compounding frequency into account.
  • Figures are rounded for display to 4 decimal places, so totals built from several rounded parts can differ slightly from the unrounded arithmetic.
  • Figures are estimates based on the inputs given. Bank charges, regulatory minima and market rates change and differ between institutions and jurisdictions. This is not financial advice — confirm with your bank or treasury policy.

How these calculators are built and tested is described on the Methodology page. If a figure looks wrong, please report it.

Figures are estimates based on the inputs given. Bank charges, regulatory minima and market rates change and differ between institutions and jurisdictions. This is not financial advice — confirm with your bank or treasury policy.

Frequently Asked Questions

Is the forward rate a prediction?

No. It is an arbitrage relationship. Deviating from it would allow a riskless profit through borrowing and lending.

Why use continuous compounding?

It is the market convention for short-dated foreign exchange forwards and makes the algebra additive across periods.

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