FX Swaps Explained Simply | How Banks Use Them for Funding

Описание: 🎯 FX Swaps Explained Simply | What Is an FX Swap and How Does It Work?

Foreign exchange swaps might sound complex — but they’re really not. In this video, we break down what an FX swap actually is, how it works in practice, and why it’s one of the most important tools used in banking, trading, and liquidity management.
You’ll learn how two simple FX trades — the near leg and the far leg — combine to create a short-term funding instrument that helps banks and corporates borrow one currency, lend another, and manage cash without taking FX risk.

We’ll cover:
✅ The structure of an FX swap (near leg vs far leg)
✅ Why banks and corporates use FX swaps
✅ What “forward points” are and how they’re priced
✅ How interest-rate differentials drive FX swap costs
✅ Real-world examples (EUR/USD funding)
✅ What terms like Tom/Next and Overnight swap actually mean
✅ How FX swaps help manage short-term liquidity

By the end, you’ll be able to confidently explain FX swaps to anyone — even if you don’t work on a trading desk.

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