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Investments glossary

Interest Rate Parity – IRP Definition


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Quotes of the day:

a good tooth, gets no gold

— Severin Meiland

Interest rate parity (IRP) is a theory in which the interest rate differential between two countries is equal to the differential between the forward exchange rate and the spot exchange rate. Interest rate parity plays an essential role in foreign exchange markets, connecting interest rates, spot exchange rates and foreign exchange rates.

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