# Forwards

Source: https://www.yieldcurve.pro/forwards

This app allows users to explore implied forward rates derived from the
US Treasury par yield curve. Forward rates represent the market's implied
future interest rates under no-arbitrage conditions.

The chart overlays the zero-coupon **spot curve** against the implied
**forward curve** for the selected horizon. The spot curve is bootstrapped
from the par yields shown on the [Curves](https://www.yieldcurve.pro/curves) page. Spot rates differ
from par yields because par yields embed coupon reinvestment assumptions —
the spot rate at each tenor represents the pure discount rate for a single
future cash flow. Forward rates can only be correctly derived from spot
rates, not directly from par yields.



## Instructions

* choose the desired **Date** using the date selector — the chart updates automatically
* choose the desired **Forward** horizon (how far into the future) from the dropdown
* click the **sparkle** button to open **ChatYCP** and ask questions about the data (login required)

## Notes

* **Date** is pre-populated with the latest available trading day
* **Forward** defaults to 1 Yr
* try asking ChatYCP: *"Is the forward curve above or below the spot curve?"* or *"What is the 1Y-forward 10Y rate?"*

Use Cases

* assess what the market implies about future interest rates
* identify carry and rolldown opportunities along the curve
* compare spot rates to forward rates to gauge term premium

Further Reading

* <a href="https://en.wikipedia.org/wiki/Forward_rate" target="_blank">Forward Rate</a>
* <a href="https://en.wikipedia.org/wiki/Bootstrapping_(finance)" target="_blank">Bootstrapping (Finance)</a>
* <a href="/blog/how-to-read-implied-forward-rates">How to Read Implied Forward Rates</a>
* <a href="/blog/salomon-yield-curve-01">Salomon Brothers' 1995 Yield Curve Primer</a>
* <a href="/blog/salomon-yield-curve-02">Forward Rates as Market Forecasts</a>
* <a href="/blog/yield-curve-recession-false-positive">The Yield Curve Predicted a Recession That Never Came</a>