Currency clause

A condition that is included in international credit, payment, foreign trade and other contracts to insure the lender and exporter against the risk of falling the exchange rate of the payment from the moment of conclusion of the contract until the moment of its payment. Usually apply two types of currency clause: a) inclusion in the agreement on the price of goods (the amount credit) stable currency as the currency of the transaction: when the exchange rate of the payment currency decreases the total cost in the payment currency will increase accordingly; b) the inclusion of a condition on a change in the price of a commodity (or the amount of a loan) in the same proportion as the exchange rate will change payment currency compared to the transaction currency rate.