The market is quoting: 1-month (30-day) GBP 0.47% 7-month (213-day) GBP 0.74% What is the 1x7 rate in GBP?
A) 0.7956%
B) 0.7946%
C) 0.7840%
D) 0.7732%

Question

The market is quoting: 1-month (30-day) GBP     0.47% 7-month (213-day) GBP     0.74% What is the 1x7 rate in GBP?
A) 0.7956%
B) 0.7946%
C) 0.7840%
D) 0.7732%

Quizplus · Accepted Answer

The 1x7 rate is the forward rate for the period starting in 1 month and ending in 7 months. It can be calculated using the formula: [(1 + 0.74% * (213/360)) / (1 + 0.47% * (30/360))]^(360/183) - 1. This results in approximately 0.7956%.

The Market Is Quoting: 1-Month (30-Day) GBP 0