bond's price and forward contract's price

CFA Level II
#1

Hi,

So I get that a bond is overvalued when the expected spot price is higher than the current forward rate but what about forward contract price. The CFAI curriculum example 7 Q4 of the first Fixed Income reading says that : A forward contract price will increase if future spot rates are lower than what is predicted by current forward rates.

Am I correct in assuming that a bond is valued using current forward rate and a forward contract price is valued using future spot rates?

Please correct me if I am wrong and provide an explanation that why do we use current forward rate to value a bond and future spot rates to value forward contract price.

#2

You can value a bond using the current par rate, current spot rates, or current forward rates (or, even, if you’re feeling particularly wild, a combination of current spot and forward rates).

I don’t get this sentence:

You’re comparing a price to an interest rate.

While true, that’s not particularly profound. The price of anything will increase if future spot rates are lower than what’s predicted by current forward rates.

Everything’s valued using current rates; we don’t know what future rates are going to be.