Definition for : Currency at (forward) premium/at discount

Currency is at (forward) Premium/discount vis-à-vis another currency if it offers lower/higher Interest rates than another currency during the period of the Forward currency transaction. Premium/nvertibility" designates the capacity to convert a given currency into any of the other freely negotiated currencies. The currency is said to be "convertible". The opposite is "crrency Option allows its holder to lock in an exchange rate in a Exercise date.
(See Chapter 49 Managing working capital of the Vernimmen)
To know more about it, look at what we have already written on this subject