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Forward Discount

What does Forward Discount mean?

Forward Forex rates are not provided by exchanges but are quoted by banks and dealers.    Forward rates are generally different from the spot rates. If the forward rate of a foreign currency is quoted lower than the spot price, the difference is forward discount.

Futures Knowledge Explains Forward Discount

For example, with the Greek crisis Euro is likely to depreciate and so in London market Euro is available at a forward discount. This indicates Euro is likely to depreciate in coming months.

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