In a first, ICICI, StanChart and HSBC enter ‘swaption’ deals

Currency Swap agreements are being seen as a way to preserve foreign exchange reserves of countries. Discuss their potential benefits and limitations. (150 Words)

Approach:

• Introduce by giving definition of Currency Swap agreements.
• Give some recent examples of such agreements.
• Enumerate the benefits of such agreements
• List the limitations of such agreements
• Conclusion