Thank you for your comment :-) If you wish to make a donation then that would be very welcome. If you visit our free website you will find a donation 'button' (and lots more free resources for Paper FM).
Because the futures prices are 100 minus the interest rate. So a higher interest rate means a lower futures price. I do explain this in the lecture :-) (But do appreciate that you cannot be asked for calculations on interest rate risk in Paper FM - that comes in Paper AFM!)
@@opentuition Oh sorry, i meant to ask this question in the foreign exchange risk lecture. Why do the spot and futures exchange rates move in the opposite directions?