Forward rate agreement | Practical Law

Forward rate agreement | Practical Law

Forward rate agreement

Forward rate agreement

Practical Law UK Glossary 5-549-3278 (Approx. 2 pages)

Glossary

Forward rate agreement

An agreement under which one party undertakes to make to the other party payments calculated by reference to a specified fixed interest rate on a notional principal sum in respect of a period in the future. Similarly, the other party agrees to make payments calculated by reference to a variable rate on the same notional principal over the same future period.