FX Swap

An FX Swap is a simultaneous agreement to buy and sell a specific amount of one currency for another at two different value dates, typically a spot transaction and a forward transaction, functioning primarily as a tool for short-term liquidity management and hedging in the foreign exchange market. This over-the-counter (OTC) instrument is the most heavily traded product in the global FX market, with daily turnover exceeding $4 trillion as of the 2025 BIS Triennial Survey, underscoring its critical role in global cross-currency funding.