FX swap
An exchange of currencies with an obligation to reverse the exchange on an agreed date.
How to read the number
A liquidity tool rather than a bet on the rate: the exchange comes back the other way, and the result is set by the difference between the two interest rates.
When the metric lies
A swap carries a currency position across the settlement date, and on days when currency is scarce its price jumps. The cost of carrying stops being predictable exactly in tense weeks.
Also known as: foreign exchange swap