Mod - 3 - Spot and forward swap points

[Jin Yoong]

Question:

Does changes in spot prices affect the forward swap points?

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Answer (JY's own reasoning):

Yes it does. Remember when we calculate the swap points, we are
allowed to use any spot rates AS LONG AS IT IS NEAR or AROUND the
prevailing spot rates (meaning we can use the bid, offer or anywhere
between or near them).

However it could be argued both ways. The spot rates affect it only in
a minor way hence you could use any rates near the prevailing spot
rates.

If however your spot rate is too far off, then it affects the swap a
lot.

I think this question is somewhat ambiguous unless it states that the
spot rate used is far away from the prevailing spot quotations.

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Feel free to provide your opinion.