The Exchange Rate Regime
What is the Monetary Authority for Jamaica?
The Bank of Jamaica
What are the features of the foreign exchange market?
High liquidity, market transparency, operates 24hrs, dynamic markets, lower trading cost, dollar most widely traded
Name one factor that influences the exchange rate to change?
1. Inflation
2. Interest Rate
3. Public Debt
What are the two forecasting approaches mentioned in the presentation?
1. Fundamental Approach
2. Technical Approach
What are the three major types of exchange rate systems mentioned in the presentation?
1. Floating Exchange Rate
2. Fixed Exchange Rate
3. Pegged float Exchange Rate
What are the types of foreign exchange markets?
Future markets, forward market, swap market, spot market, option market
An_______ is the value by which two currencies are traded for one another. In other words, it is the rate or value at which one currency can purchase another currency.
exchange rate
Why is exchange rate forecasting important?
1. It evaluates the foreign-denominated cash flows involved in international transactions.
2. It evaluates the benefits and risks attached to the international business environment.
3. It helps brokers and businesses make informed decisions to help minimize risks and maximize returns.