We will apply the balance of payments model for determining FX rate movements and FX interventions by central banks.
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Tag Archive: financial account
(6.1) FX Theory: The relationship between Current Accounts Surpluses and the Carry Trade
The EUR/USD is going on its longest winning streak for a long time. Since May 27, it has improved from 1.2850 to 1.3396 and is approaching 1.34. What are the reasons?
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FX Theory: The Balance of Payments Model Explained in 400 Words
The balance of payments leads to many confusions because definitions vary. For example, the IMF’s definition is different from the usual or historical definition. Secondly, the relationship between the balance of payments and reserve assets is difficult to grasp, especially in the IMF definition. Thirdly the origin of “errors and omissions” is often unclear. Therefore …
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