Day: March 9, 2022

The following theories explain the fluctuations in exchange rates in a floating exchange rate regime (In a fixed exchange rate regime, rates are decided by its government): 1. International parity conditions: Relative purchasing power parity, interest rate parity, Domestic Fisher Read More …

Money transfer companies/ remmitance companies perform high volume- low value transfers generally by economic migrants back to their home country. In 2007, the Aite Group estimated that there were $369 billion of remittances (an increase of 8% on the previous Read More …

The foreign exchange market (forex, FX, or currency market) is a global decentralized market for the trading of currencies. This includes all aspects of buying, selling and exchanging currencies at current or determined prices. In terms of volume of trading, Read More …

Here we will consider the bank in two roles: (1) as the institution financing the importer, and (2) as the exporter’s bank. 1. Imports under Documentary Credit (DC) Before undertaking to establish a DC for an importer, the bank should Read More …