The notional principal is never exchanged in an interest rate swap.

Name: The notional principal is never exchanged in an interest rate swap.
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In an interest rate swap, the notional principal is used to calculate the interest payments, but it is not actually exchanged between the parties involved in the swap. Instead, the counterparties exchange fixed and floating interest rate payments based on the agreed upon notional principal amount.

The Notional Principal Is Never Exchanged in an Interest Rate