Chap 12 International Financial Markets 国际金融专业双语教学课件.pptVIP

Chap 12 International Financial Markets International Financial Markets International financial markets are the places in which international financial transactions are taken place. These businesses include long-term and short-term debts, transactions of forex and gold. A Eurocurrency is a dollar or other freely convertible currency deposited in a bank outside its country of origin. The Eurocurrency market, which is also called off-shore financial market, consists of those banks, that is, Eurobanks that accept deposits and make loans in foreign currencies for the non-residents. The Eurocurrency Market Note that the prefix Euro as used here has nothing to do with the currency known as the euro. The Eurocurrency is a name given to those currencies outside their origin country. The Eurocurrency market isn’t confined to the European financial centers. It is the off-shore financial market of all world. Not only short-term loans but also medium-term or long-term loans are operated in the market. The Eurocurrency Market The Eurobond and Eurocurrency markets are often confused with each other. In the Eurobond market, Eurobonds are sold outside the countries in which currencies of the other country are denominated in. In the Eurobond market, Eurobonds are issued directly by the final borrowers. The Eurocurrency market enables investors to hold short-term claims on commercial banks, which then act as intermediaries to transform these deposits into long-term claims on final borrowers. The Eurocurrency Market The dominant Eurocurrency remains the U.S. dollar, but the importance of the Eurodollar waxes and wanes with the strength of the U.S. dollar. With dollar weakness in the latter parts of both the 1970s and 1980s, other currencies particularly the Deutsche Mark and the Swiss franc increased in importance. Dollar strength in the 1990s again boosted the relative importance of the Eurodollar. The euro has now become an important currency for denominating Eurocurrency lo