Work out forward contract rate instantly with clear inputs, formula shown and shareable results.
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.
Forward rate
F = S × e^((r_domestic - r_foreign) × t)
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.
No. It is an arbitrage relationship. Deviating from it would allow a riskless profit through borrowing and lending.
It is the market convention for short-dated foreign exchange forwards and makes the algebra additive across periods.