In a currency swap, both principal and interest payments are usually included as part of the swap

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In a currency swap, both principal and interest payments are usually included as part of the swap agreement. For interest rate swaps, it is usual to include only interest rate payments. The reason for this is that both principal and interest are exposed to foreign exchange risk. LO.1

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Financial Markets And Institutions

ISBN: 9781259919718

7th Edition

Authors: Anthony Saunders, Marcia Cornett

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