Foreign Exchange Market Characteristics

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Being the main force driving the global economic market, currency is no doubt an essential Element for a country. However, in order for all the countries with different currencies to trade With one another, a system of exchange rate between their currencies is needed; this system, is formally known as foreign exchange or currency exchange. Particularly for foreign exchange market there is no market place called the foreign exchange market. It is mechanism through which one country’s currency can be exchange i.e. bought or sold for the currency of another country. The foreign exchange market does not have any geographic location. Foreign exchange market is described as an OTC (over the counter) market as there is no physical place where the…show more content…
the cutting-edge forex marketplace started out forming in the course of the Seventies after 3 decades of government regulations on foreign exchange transactions (the Bretton woods system of economic management hooked up the guidelines for commercial and economic family members the various world's essential business states after global warfare ii), when countries progressively switched to floating alternate prices from the previous alternate rate regime, which remained fixed as in line with the Bretton woods machine. The foreign exchange market is unique because of the subsequent characteristics: • It’s huge buying and selling volume representing the largest asset class within the world leading to high liquidity. • Its geographical dispersion. • Its non-stop operation: 24 hours a day besides weekends, i.e., buying and selling from 22:00 gmt on sunday (sydney) till 22:00 gmt friday (big…show more content…
The term foreign exchange market is used to refer to the wholesale a segment of the market, where the dealings take place among the banks. The retail segment refers to the dealings take place between banks and their customers. The retail segment refers to the dealings take place between banks and their customers. The retail segment is situated at a large number of places. They can be considered not as foreign exchange markets, but as the counters of such

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