If a 6-month AUD/NZD swap is quoted 173/165, which of the following statements would you consider to be correct?
A) 6-month AUD rates are higher than 6-month NZD rate
B) 6-month AUD rates are lower than 6-month NZD rates
C) Spot AUD/NZD will be higher by approximately 170 p
D) The AUD yield curve is positive, whilst the NZD cu

Question

Quizplus · Accepted Answer

The higher number (173) represents the AUD rate, indicating that 6-month AUD rates are higher than 6-month NZD rates. The swap points (the difference between 173 and 165) do not provide any indication of the spot rate, so C is incorrect. The information given does not provide any indication of the shape of the yield curve, so D is also incorrect.

If a 6-Month AUD/NZD Swap Is Quoted 173/165, Which of the Following