Question on Reading Currency Forward Rates

Discussion in 'Forex Trading' started by sf631, Jul 17, 2012.

  1. sf631


    I am in need of some (simple) help on reading currency forwards on the USD/INR pair. The below table has 1M, 2M etc... forward rates on the pair, and I'm guessing, based on the magnitude of the values in the bids & asks, that there's a 1000 multiplier on this contract but can't find that info anywhere.

    Put another way, if the 12M forward price is 31,550 and the current exchange rate is 55, does that mean the forward market is building in an exchange rate of 58.1550 in a year? that would make sense as the interest rates in India are considerably more than in the US now, so assuming it's something in this order of magnitude but want to make sure.

    Thanks in advance.
  2. sf631