Magneto Investments is a European$-$based hedge fund that frequently invests in countries all over the world. Magneto's financial statements are reported in euros. Magneto recently entered into a swap agreement to pay ABC Bank a stream of U$.$S$.$ dollar cash flows based on a $5\%$ fixed rate in exchange for another stream of U$.$S$.$ dollar cash flows based on $1$ year LIBOR. The annual swap settlements are based on a $$10$ million principal amount. The swap agreement between Magneto and its counterparty is considered $\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_.$

Group of answer choices

a currency swap

an equity swap

an interest rate swap

a credit default swap