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Currency area |
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Currency areaA group of countries that share a common currency. Originally defined by Mundell (1961) as a group that have fixed exchange rates among their national currencies.Similar MatchesEurocurrency marketEurocurrency marketThe money market for borrowing and lending currencies that are held in the form of deposits in banks located outside the countries where the currencies are issued as legal tender. Currency BoardCurrency BoardEntity charged with maintaining the value of a local currency with respect to some other specified currency. Currency swapCurrency swapAn arrangement in which two parties exchange a series of cashflows in one currency for a series of cashflows in another currency, at agreed intervals over an agreed period.Companies would do this where they have existing borrowings in a currency which they want to convert into a borrowing in another currency. If its borrowing is at a fixed rate, and it is exchanging for another fixed rate borrowing, the swap is a 'fixed rate currency swap'.Unlike an interest rate swap, a currency swap usually does involve an exchange of the principal borrowed amount as well as the interest payments. Foreign currency optionForeign currency optionAn option that conveys the right (but not the obligation) to buy or sell a specified amount of foreign currency at a specified price within a specified time period. Foreign currency forward contractForeign currency forward contractAgreement that obligates its parties to exchange given quantities of currencies at a prespecified exchange rate on a certain future date. Further SuggestionsCurrency Exchange RiskReserve currency Foreign currency mortgage Currency factor Comptroller of the Currency Currency call option Blocked currency Currency reallignment Currency swap currency conversion Currency revaluation Currency depreciation Currency reserves Currency devaluation Intervention currency Eurocurrency Currency risk sharing Vehicle currency Reporting currency eurocurrency Currency union Convertible currency Canonical model of currency crises Currency risk Currency no longer issued |
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