“The Federal Reserve Bank intervened today with a coupon pass through the primary dealer network to add needed reserves to the banking system. The added liquidity will help as the banking system is awash in counter-party risk to swaptions and other derivative transactions. The forex market responded with strength in the US dollar on most currency-pairs including Euro, Yen, Sterling and Yuan.” Huh? Wouldn’t it be great to know what the newscaster just said? Dean Lundell’s Primer on the Interest Rate, Fixed Income and Foreign Exchange Market can help by explaining these terms in everyday, lay language.
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