Sure, with such a contract buyers of Euros will be disappointed, if the actual exchange rate in December turns out to be 104 and delighted when it is 112. But the contract gives them certainty. Such contracts greatly facilitate cash flow and liquidity management.
At the same time, their price is very easy to compute – the future exchange rate depends on today’s exchange rate plus the differential between interest rates – the key policy rate of the NBS and refinancing rates of the foreign currency – over the duration of the forward contract.