Calculate forward exchange rates, interest rate parity conditions, and identify arbitrage opportunities in international finance.
Analyze the relationship between interest rates and exchange rates to determine forward rates, assess parity conditions, and identify profitable arbitrage opportunities in currency markets.
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Standard one-year forward rate calculation between US Dollar and Euro with typical interest rate differential.
Domestic Rate: 5.25 %
Foreign Rate: 3.75 %
Spot Rate: 0.85
Forward Rate: 0.8542
Time Period: 1 years
British Pound to US Dollar with significant interest rate differential showing forward premium.
Domestic Rate: 6.5 %
Foreign Rate: 2.25 %
Spot Rate: 1.3
Forward Rate: 1.355
Time Period: 1 years
Japanese Yen to US Dollar in low interest rate environment with forward discount.
Domestic Rate: 0.1 %
Foreign Rate: 4.5 %
Spot Rate: 110
Forward Rate: 105.5
Time Period: 1 years
Short-term three-month forward rate calculation for currency trading.
Domestic Rate: 4 %
Foreign Rate: 2.5 %
Spot Rate: 1.15
Forward Rate: 1.1543
Time Period: 0.25 years