1.1 .- THE MARKET EXCHANGE
1.1.1 .- History
The foreign exchange market has existed in its current form, called a floating exchange rate regime since March 1973 and the abandonment of fixed exchange rates of various currencies against the dollar standard end of Bretton Woods in 1944.
The major stock exchange is currently in London with about 30% of the market, New York with 20%, 12% Tokyo, Zurich, Frankfurt, Hong Kong and Singapore, with about 7% each, followed by Paris and Sydney with 3% each. The market works with 24/24. Thus an investor (regardless of where they live) in contact with a foreign exchange broker in each market may be running 24/24.
1.1.2-Definition of the foreign exchange market
The foreign exchange market is the market where currencies are traded around the world. Operators traders do not meet physically but are in constant telephone communication. By the forces of supply and demand at any time, prices for each currency are almost identical in all major markets worldwide. It is the largest market in the world with daily turnover exceeding 1.5 trillion dollars. Unlike equity markets, the forex market there is no centralized listings only transactions over the counter. This means that operators come into contact with each other individually, by telephone or computer networks.
In addition, the exchange is the act by which we exchange the currencies of different nations. The coins are the same form as the currency within a country. Most of the monetary assets traded on foreign exchange markets are deposits in banks. The exchange rate is the price of the currency of a country in terms of the currency of another. It is a relevant indicator in this market.
1.1.2-Highlights
a) A market-system dominated by a few financial centers
Unlike stock markets, which have a particular geographical location, the foreign exchange market knows no borders, there is a single foreign exchange market in the world. Transactions in foreign currencies are both at the same time in Paris, Tokyo, London or New York. Because of its global nature, the foreign exchange market is an economic organization without proper regulation, it is self-organized by public and private bodies involved in it. The foreign exchange market is geographically concentrated in the financial markets of some countries.
b) A market dominated by a few coins
Transactions in foreign exchange markets have focused on a small number of currencies, and overwhelmingly on the dollar. In 1998, the U.S. dollar takes on average 87% of the identified transactions, from the supply side or the demand side. The currencies of the euro area appear in 52% of transactions (30% for the 5% mark and French franc), the Japanese yen and British pound are down, they are involved in 21% and dans11% of transactions .
c) A market dominated by risky futures
Currency risk is the risk of capital loss related to changes in future exchange rates. Since the seventies, the risk increased sharply with the generalized floating of currencies and the development of international trade and financial transactions. The existence of changes in foreign exchange has two different types of attitudes on the part of market participants: some groups do not want to bet on what will be the exchange rate in the future. They are exposed to currency risk in the ordinary course of business and seek to cover their credit or debit position. Other groups feel they can take a position exposed to currency risk, for gain. Then there is speculation about future foreign exchange transactions through arbitration. In reality, transactions Cambiaire mixed with varying coverage and speculation and the same individuals may adopt these attitudes. The forward exchange contract is the primary means to hedge or speculate on the foreign exchange market. Which is why it dominates the spot foreign exchange contract: in 1998 63% of the operations of foreign exchange markets are futures and only 37% of cash transactions. A forward exchange contract is an agreement to exchange one currency against another at a future date at a price fixed today, the exchange rate over time. There are various foreign exchange forward contracts: contracts based on traditional operations, and bank term "swap" trader, are the most common (57% of the operations of foreign exchange markets in 1998), those based on other derivatives, "future" and currency options are still marginal (6% of operations in 1998).
d) A market dominated by banks
Three groups of agents operating in the foreign exchange market: the first group consists of companies, fund managers and individuals; The second combines the monetary authorities (central banks); The third group consists of banks and brokers who provide the daily operation of the market. The agents of the first group but do not directly transmit orders to the banks so-called "customer" for the purchase or sale of foreign exchange. This is the retail market (transactions between banks and their customers). The monetary authorities intervene in the market to regulate prices (purchase and sale of foreign currency) and possibly regulate foreign exchange transactions (exchange controls). Traders banks and brokers are the only private players to operate directly on the market. For this reason, the foreign exchange market is primarily a wholesale interbank market. In 1998, nearly 90% of operations are performed Cambiaire between banks and other financial intermediaries.
1.1.4 .- International Arbitration
International arbitration in exchange rates will ensure equality of exchange rates, given the transaction costs of each currency on the various wholesale markets, giving rise to an International Foreign Exchange Market. For example, the American dollar is traded on the interbank market in Europe (London, ....) And Asia. If, for example, the rate of the Canadian dollar on the interbank market was $ 0.885 in Canada and US 0.89 US in New York, arbitrageurs would sell Canadian dollars in New York and concurrently retract in Canada, generating a gross profit and .
1.2 .- THE INTERNATIONAL MONETARY SYSTEM / SYSTEMS EXCHANGE This system has evolved over time. Historical pattern is divided into four (4) periods. The first (1870-1914) saw the introduction of the gold standard is a set of fixed exchange rates and focused on gold convertibility of currencies. Second, due to the Genoa Conference in 1922, there has been the progressive establishment of alternative system "gold exchange standard." This allowed central banks to guarantee the convertibility of their currencies to the holding of gold and currency reserves in gold. The third period extended from 1944 to 1971 and is marked by the creation of the IMF. The gold exchange standard is maintained but relaxed. The variation of plus or minus 1% was defined for each currency to USD. Finally, in 1971 the system of floating exchange agreements endorsed by Kingston in 1976 came into force. 1.3 .- ECONOMIC IMPORTANCE This global market, which is essentially interbank financial market is the second in the world in terms of overall volume, behind the interest rate. Nevertheless, it is the most concentrated and the first for the liquidity of the most treaties, such as the euro / dollar. To give an idea of liquidity in circulation, the daily volume of trade was in 2004, 1900 billion USD, including: 600 billion in spot transactions and 1 300 billion in futures Transactions by volume were: 53% between banks; 33% between a bank and a fund manager or a nonbank financial institution; and finally to 14% between a bank and a non-financial and also individuals that use the platforms of the banks In every major bank, traders (traders said) are the 3x8, although generally in different locations. A team located in Asia or Australia succeeds another located in Europe and finally a third located in North America, and so on. In his last three-year study, the BIS (Bank of International Settlements) has shown that more and more individuals choose to invest in Forex. Although they still represent a very small minority of transactions and volumes, a dedicated market for private investors has grown in parallel. It suffices to note the number of trading platform available to them on the internet and the tools of real-time information once reserved for professional traders in the trading rooms. Now the active trader of foreign exchange market can invest minimum amounts, and due to the existence of leverage-trader in conditions almost (!) Similar to the professional trader. Information tools in real-time broadcast news and forex basic information (economic indicators) and thus offer individuals the ability to trade under the conditions of real time. 1.3.1 .- Economic Indicators The economic indicators are of paramount importance in the study of foreign exchange market. They measure objectively certain aspects of economic activity and should be easy to use An economic indicator is not neutral in terms of either moral or social, as its construction follows from the choice of policies and priorities. They are very different and each can be compared to an aggregate economic or industry: for example, we can say that the retail sales provide some assessment of changes in household consumption. 1.3.2 .- Links between economic variables Before dealing with the relations of "cause and effect" between the major economic variables, it would be wise to stop the economic phenomena critical to the foreign exchange market. 1. Variables evidence to the foreign exchange market: The subject was and is a must for turning a large number of practitioners in the foreign exchange market. Since the introduction of floating exchange rate system in 1973, the exchange rate does not vary more than within a fluctuation margin permitted but rather based on supply and demand and the daily . So there is more than the official price of a currency. Theorists have considered and the exchange rate as an "equilibrium price of foreign exchange flows" and have developed stable relations between the interpretative exchange and a number of other variables. We distinguish between explanations based on fundamentals and those based on expectations of rate itself. But we will only briefly consider the first category in this section. It will therefore address: The theory of purchasing power parity (PPP) and the real exchange rate; The theory of interest rate parity (PTI); The trade balance and current account.
The use of the trade balance or current account is very common: a deficit place a country in a net buyer of foreign currencies against the national currency, which depreciates automatically. A surplus, in contrast, generates sales of foreign exchange transactions against the currency market, pushing it upward. However, whether the PPP, the PTI or links to the current account or commercial anticipation of the exchange rate is very difficult to achieve in the short term. 2. Dependencies between economic variables: It should be noted that the economic movements in the short and medium term are often grouped into a macroeconomic model where we compare the movements past and present in the form of equations with coefficients pre-calculated on the basis of the history to determine influences they exerted between them. "One part of the anticipated demand by entrepreneurs, which determines the level of domestic production and thus the separation between production and supply imports. Production determines the level of employment and taking into account the labor force, unemployment. Wages are explained by the level of unemployment and contribute to the formation of production costs that are tight with the production capacity at the base of the process of determining prices and incomes. "Eric Vergnaud, economic indicators and financial markets, p63.
Determination of supply and demand The supply and demand are probably the most venerable concepts and the most basic of economic theory. Current models assume that supply adjusts to demand, which is otherwise determined. Companies are forced to adapt to the demand since there is no explicit offer
Firm Behavior: They are sometimes demand variables (start-up activity, the stocks are replenished and the change is positive), now the variables of supply (when firms face a demand exceeds domestic production, destocking will meet the external demand without imports). Stocks play an important role in balancing their detention is due to the ongoing effort to minimum security vis-à-vis supply in the short term without incurring the expenses to the extent and costs that may result.
Household Behavior: Consumption depends on five variables: Income: the higher the income increases, consumption marginal propensity to consume increases, the correlation is positive here. Savings acting as a buffer in the short term. Prices at this level there are two routes, the first called "flight from money" causes people to advance their expenses if they anticipate a rapid inflation. The second pushes them to focus on savings to the detriment of consumption. The unemployment weighs heavily on consumption as the unemployed build precautionary savings. Interest rates: rising interest rates, encourage saving (substitution effect) or favors current consumption (income effect). Investment in housing: separate those who buy homes with a view to consumer or investor. The first couple will be more sensitive to income / price and the second to interest rates and anticipation of household income. Foreign trade: imports and exports depend on three types of variables: 1) a variable real income, in this case of domestic demand; 2) a variable reflecting the influence of relative price competitiveness of exports; 3) a variable that measures the voltage on the production system External demand is shown by the indicator of global demand, which indicates the market share owned. To increase exports, increase the degree of competitiveness. Domestic demand is the sum of household spending on consumption and investment in housing, business investment and government expenditure. It will be high if domestic production can meet domestic demand 1.3.3 .- Economic role of the exchange rate The exchange rate is an indispensable factor in the foreign exchange market, can play either positively or negatively in the functioning of this market. They act on import prices and export, and the direction of capital flows between economic regions. Thus, the exchange rate has a major role in the development process of an economy in determining the balance of external accounts and competitiveness of the economy, influencing the ability to export, to import and attract foreign capital in a country. As a result, countries and economic zones manipulate exchange rates in order to influence: the competitiveness of their products and services and their attractiveness in terms of capital flows.
1.4 .- OPERATION MARKET EXCHANGE The foreign exchange market operates daily on a continuous basis in terms of concluding acts of the purchase or sale of foreign exchange. It is an OTC market in other words, transactions that are entered are not officially standardized, centralized or guaranteed by any authority. This market is not localized and is composed of the permanent flow of supply and demand flowing continuously by specialized information networks, thanks to powerful means of communications and computer systems connected by satellite. It has a character of market-wide network. Three groups of economic agents act on the foreign exchange market: 1) Companies with the development of free trade and the expansion of world trade are increasingly concerned by the activities of export and import; 2) The financial intermediaries, banks and brokers, provide market liquidity and bring together supply and demand. In fact, the importance of banks as the foreign exchange market is largely an interbank market. 3) Central banks provide a regulatory function and regulation, they shall also apply the choice of exchange rate policy decided by governments. 1.4.1 .- Organization of the market The foreign exchange market is mainly used to manage currency risk and currency exchange to facilitate international trade and financial transactions. It is also used for speculative purposes. In addition, banks play a dominant role on the foreign exchange market. Compartment retail, they buy and sell currencies to meet the needs of their customers (individuals, businesses and governments), these transactions are constantly varies the level of stocks of various currencies they hold. The interbank market allows, among other banks to hold foreign currency amounts as they deem appropriate given their objectives, in terms of profitability and their aversion to currency risk: they traded with each other and by 'exchange brokers, intermediaries ensuring anonymity. The rate of exchange on the interbank market can be considered as the acquisition costs of various currencies and serve as a reference for determining the exchange rate in the compartment of detail. 1.4.2-Foreign Exchange These are all transactions involving an exchange of two currencies. The global foreign exchange market is extremely active: the demand induced by the activity of importing and exporting companies is relayed and amplified by speculation. It is an OTC market, led by banks and brokers. a) The change in cash The currency exchange cash or "spot" is to exchange two currencies at a price negotiated, 2 days after the trade date. This is referred to the date "spot". The main features of a cash foreign exchange transaction are: The main currency, Sense: buying or selling, The secondary currency, currency or "price": currency sold if it is a purchase, purchased currency in the case of a sale, The trade date or "trade date" The value date or "date spot" generally equal to the trade date + 2 business days. Note: A spot foreign exchange contract has a lifetime of zero, there is no "end date" The negotiated amount, expressed in the primary currency, The traded price, The amount in the secondary currency, calculated from the amount of principal and current The characteristics common to all market transactions: The trading or "book", possibly the identity of the trader, La counterpart Eventually the intermediary or "broker", for which the negotiation was made, The settlement instructions: identification of (the correspondent bank and the counterparty) in which currency must be delivered / received. b) Courses Market participants still cotent currency as a price range: the lowest being that to which the trader is willing to buy: the bid price or "bid" and the highest one he is ready for sale: asking price or "ask." The difference is most often on the "points", which means the third and fourth decimal places, the "figure" in turn refers to the second decimal place. Finally it should be noted that during dev1 / DEV2 means "a unit of the course dev1 = DEV2. Dev1 is traded currency, the currency DEV2 "price". For example a quotation EUR / USD = 1.0210/40 means that the trader buys one Euro for 1.0210 USD 1.0240 against USD and sells. The mode of expression of the course is an agreement related to the level of "priority" currencies against each other. Currency rating "to certain" when the mode of expression of the course is equivalent to setting the value of a unit of that currency. The Euro symbol in some against all other currencies. The score at some Dollar against all other currencies except the Euro .... c) Cross rates The courses available on the market are the most common transactions: every day during the Euro or the Dollar against all other currencies are permanently displayed. For currency pairs that are not usually listed on the market, we pass through one of these two currencies in order to establish a cross-over or "cross". For example the couple to rate JPY / CHF, the trader will use the USD / JPY and USD / CHF. The course JPY / CHF = (USD / CHF) / (USD / JPY). d) Forward contracts The forward exchange is an exchange of two currencies at a date (value date) and during (forward) traded. This type of contract can fix in advance a course between two currencies, and thus to hedge against currency risk. The characteristics of a forward exchange transaction are defined in relation to an ongoing "spot" (being used for the spot foreign exchange) as a reference for the operations of the day. The difference between the spot and futures prices is called the "end points". When the futures price is higher than the spot is called "report". When the futures price is lower than the spot is called "backwardation." The characteristics of a forward exchange transaction are: The main currency, The direction (buy or sell) from the main currency, The secondary currency (currency sold for a purchase, bought for a dollar sale of the primary currency) The current "spot" The forward points: the forward rate = spot price + points run The trade date, The value date: the date on which the currency will actually be exchanged; e) Foreign Exchange Swap A swap is a dual foreign exchange: an exchange or "leg" when executed with the implementation of the contract, the date spot and forward exchange, performed at a date negotiated. The difference between the spot and futures price is referred to as "hot swap". The swap can be obtained immediately currency and then sell them at a price negotiated at the establishment of the contract at maturity of the swap. For example a customer who has cash in Euro, and wishes to place them in U.S. government bonds, 3 months, bought dollars today to fund this purchase, and then resells them to maturity at a known price. Compared to a forward exchange, cash flows exchanged back that this time the trader purchased the currency really ready to run, and really takes the currency sold. The forward rate is therefore calculated in the same way. The characteristics of a swap are: Leg "go" has the characteristics of a spot exchange: Main currency Sense: buying or selling Secondary Currency amount in primary currency Spot The value date is equal to the trade date + 2 days Leg "return" has the characteristics of a forward exchange, which are derived from the operation of spot: The purchased currency is the currency sold in the leg to The currency is the currency bought sold the leg to The amount expressed in the primary currency is identical The value date is the date on which the reverse exchange will The course is the spot rate + swap points 1.4.3 .- Treatment of a foreign exchange transaction, Negotiation The foreign exchange market is an OTC market, led by banks and brokers. Platforms such as electronic trading Reuters Dealing and EBS (Electronic Broking Service) are commonly used. These platforms can be negotiated on a conversational mode: traders called "chatting" literally, and then validate their deals. Or they apparient proposals automatically entered by the participants: in this case is the system that creates the deals, and counterparties do know that once the negotiation is complete. Holding position The system Front - Office records deals in real time. The deals negotiated by telephone are entered by the trader, the deals made in the electronic platforms are transmitted automatically. The position keeping system offers the following basic features, which are the minimum requirements: Pricing (pre-trade value based on the logical view above) Manual or Automatic deals Validation deals Control of risk: counterparty risk, market risk (control limits) Update positions in real time Calculate P & L (profit) in real time Ability to automatically generate deals, Transmission of the "ticket" validated Back Office Back Office System Back - Office function is to materialize the transactions negotiated by the trader: a) Vis-à-vis counterparties: Issue of confirmations: foreign exchange transactions are confirmed by SWIFT MT300 Reconciliation of confirmations: given the huge amounts negotiated transactions, back offices to establish systems of rapprochement between the automatic confirmations issued and confirmations received. This helps to detect errors or misunderstandings before triggering the payments. Issue of payments: generating a payment order (MT202) for in the currency paid, a notice of entry of funds (MT210) for in the currency received. If the consideration is internal (client, deal between two desks), payments are made via the accounts (debit / credit account). b) Vis-à-vis the institution: Recording of transactions: the exchange deals are recorded off - balance (accrual basis) during the period between the trade date the date of value, then the value date is reached, off-balance sheet accounting is reversed and operations are recorded on the balance sheet of the bank. On the other hand the supply of foreign exchange accounts that are not denominated in the currency of holding the balance of the bank. Positions held accountable for supplying foreign exchange position, which records the daily revaluation currency risk incurred by the bank. 1.4.4 .- Typology of actors The main types of actors on the foreign exchange market are: Commercial banks are the center of the market .. They are involved through their market making activity which is to provide an exchange with the purchase and sale and to act as counterparty in transactions initiated by others or for themselves or their clients. Through major commercial banks operations are carried out based on instructions of Importers and Exporters, investment institutions, insurance companies, pension funds and private investors. Commercial companies for their part, operate in several countries and make or receive payments in currencies other than the currency in the country of their headquarters. The nonbank financial institutions that offer a wide range of services to their customers, most of which are also offered by banks. Brokers who are active participants in the market. As intermediaries between the many banks, funds, grants etc places. Their role is to find counterparts to requests addressed to them, for a fee. Central banks, although fewer, are involved in the market following a trading volume can have an important impact on it. They will operate according to a pattern controller, or to correct a distortion of the value of their currency against another, or to influence the competitiveness of the national economy or to increase their reserves. The motivations of market players are five in number: speculation coverage, arbitration the transaction; stockpiling foreign currency monetary considered strong. We managed to identify three types of agents on the foreign exchange market: 1) Market makers typically working in large commercial and investment banks. They offer a bid and an ask price for the amount of money they are willing to share. According to Lyons (2005) reported by Bailliu and King (2005), these agents are portrayed as risk-neutral or risk-averse getting most of their earnings gaps between bid and ask prices. 2) Brokers are not a function of market making. Rather, they are facilitators of anonymous transactions between counterparties. 3) End customers: non-financial customers, financial institutions without leverage and leveraged institutions. These agents are the most significant market at the macro level. They are the main providers of liquidity in the market in daily basis. According to these authors, the order flow of customers accurately reflects the changing exchange rates at low frequencies in terms of foreign exchange. In practice, many players use technical analysis in conjunction with fundamental analysis to determine their trading strategy. Although it may take a major difference between the two approaches: a fundamentalist focuses on what should happen in a market, he studied the causes of market movement by driving a macro or strategic assessment of the price range of the currency depending on a variety of criteria (the country's economic situation, monetary policy ...) except the price movement of the currency itself, a major component for Chartist. 1.5 .- ROLE AND IMPACT OF FOREIGN EXCHANGE MARKET
Exchange markets is by far the most important in terms of volume changes. Average volume traded on the exchange markets traditional attient 1200 billion USD per day. This should be completed in 875 billion USD / day (Derivatives).
Exchange markets have a positive impact in the functioning and development of a country. They allow agents to protect against currency risk. For example, the exporter may sell foreign exchange forward the recipe for future sales abroad to prevent the appreciation of the currency would reduce its sales in local currency, the importer can protect themselves from rising costs in national currency resulting from the possible impairment of the national currency by buying foreign currency on the spot market or futures market, the manager who tries to take advantage of higher interest rates abroad will be inclined to sell on the futures market value at maturity of its foreign investments, etc..
The agents also traded on the foreign exchange market to convert currencies to protect against currency risk and to speculate on changes in exchange rates. The conversion of currencies resulting from the commercial and financial transactions. For example, exporters are selling the recipe for their foreign sales denominated in foreign currencies to pay suppliers and employees, pay taxes and pay dividends to shareholders. Importers buy foreign currency to pay for their purchases abroad, the national wishing to acquire a foreign company buys the currency of the host country, the foreign acquiring portfolios of securities issued by domestic entities have to sell their currency against the domestic currency.
Speculators are trying to capitalize on expected changes in exchange rates. For example, the exporter provides a depreciation of the currency conversion will differ from his recipe in foreign currency to increase its revenue in local currency; the importer provides an appreciation of the currency will be inclined to defer possible the purchase of foreign currencies in order to reduce their bill in local currency.
1.6 .- EXAMPLE OF THE STATE OF HAITIAN EXCHANGE
1.6.1 .- The Haitian currency By definition, money is any object accepted and used to settle financial transactions or to exchange goods and services. In Haiti, the gourd is the national currency unit. It is defined by the three main functions it performs in the economy: a medium of exchange, standard, store of value. Being seen as a medium of exchange, the gourd is used for the purchase and sale of goods and services, such as standard or unit of account, it is used to evaluate the prices of goods and services and record debts. Finally, through its store of value, it will keep the value and transfer the purchasing power of this in the future. According to Cohen (Alter Eco., Special Issue # 45) reported by DOUR (2003), the currency is a negative sum game, nobody wins. Using purchasing power, the gourd helps Haitians and socially binding is strongly influenced by the monetary policy of the Central Bank when its acceptance is challenged. 1.6.2 .- The BRH and exchange control The non-routine operations of the BRH of the foreign exchange market is one of the instruments available to it to articulate its monetary policy. They can be regarded as an operation of "open market" where the BRH involved in the formal market exchange (banks and brokers licensed) to buy or sell currencies when deemed necessary. In 1999, the Central Bank interventions on the foreign exchange market are used mostly: As a complementary instrument to regulate bank liquidity, especially in times of pressure on rates; To demonstrate an active presence of the OHR, which ceases to be a passive actor in the foreign exchange market. According to Chatelain (1954) reported by DOUR (2003), the Convention of 1919 stipulated the obligation of the Bank of the Republic of Haiti (BRH) to maintain its program in return for a blanket made of 100% for the third in lawful money of the United States and the balance of commercial paper and short-term with certain guarantees to repay on time. Hence the role of regulation conferred on the Central Bank which, through its market intervention, monitor and maintain the fixed exchange rate. This convention was a bottle of hard currency like the U.S. dollar. The 1987 constitution through Article 226 gives the Central Bank the exclusive power to issue paper money and metal parts by title, weight, description, sales and employment across the country. The legal tender of the gourd is thus established. 1.6.3 .- History of the adoption of floating exchange rate system
By the Monetary Agreement of April 12, 1919, the gourd has been defined in relation to the dollar standard (TCO: 1 / 5 that is to say 1 USD = 5 Gdes). The gourd was issued under strict regulation to ensure the official parity. The fixed exchange rate lasted several decades, but the persistence of structural deficits in the trade balance brought the BRH to adopt the system of floating exchange rate in 1991. This has ended the official segment of the market exchange rate and increased significantly from the parallel exchange market.
1.6.4 .- Evolution of the exchange rate Since the adoption by the BRH of floating exchange rate system in 1991, the exchange rate has been very high variability on the rise due to the effects of advertising and the accentuation of pessimistic expectations fuel the cascade of events ` policies of the crisis. Between 1991-1994, the gourd depreciated gradually against the dollar. The reference exchange rates increased from 7.45 to 10.18 in 1991 Large-Large-1992, Large-12.40 in 1993 and 15.10 in 1994 inflation rates of 22.8% and 40% respectively in 1991 and 1994. Between 1994-1999 the stability of exchange rates has led to a slight appreciation of the gourd compared with 1991-1994. This may be due to the modest recovery of economic activities in the country and external economic assistance after three years of economic stagnation. From 1999 to 2003 the exchange rate USD gourd grew exponentially. According to Boyer (2004), the return in force of the system of exchange floated the gourd to finally sink in October 2002. The record rate of 1 USD = 50 flasks was recorded February 11, 2003, unprecedented in monetary history of Haiti since April 12, 1919. This period of political and economic crisis was facilitated by the discussion "the need for the Haitian economy dollarization as a palliative measure." The plummeting value of the gourd against the dollar is linked to foreign trade deficit and volume of internal transactions made in dollars. Ultimately, the BRH is involved in the process of change to: • a better understanding of the market by participating in it; • to be continuously aware of any movement rate (ie quotes that may affect the market); • to be confirmed as an actor in the system by normalizing its operations; • have the ability to finance its recurrent expenditure in foreign currencies through the market without drawing on its official reserves.
CONCLUSION In conclusion, it seems interesting to highlight the current questions about the indispensability of the foreign exchange market in the functioning of a country. Central to this question is of course the problem of the efficiency of handling the exchange rate depends not only on inflation differentials and interest but also other factors such as level of development achieved by the industrial, commercial or specialization of international integration. Manipulation of exchange rates by economic acts on the structures and the problem is whether this manipulation is likely to promote structural change desired, or simply to contribute to economic growth in the market. While the currency markets are well branched and that companies can adopt blankets, some still fear that flexible exchange rates from leading to unwarranted risks and uncertainties. The foreign exchange market is clearly one of the best ways that can promote growth and prosperity of a country if all economic indicators are well understood and that the actors play their role effectively to balance the market and control the stability of the exchange rate to benefit from strong economic growth internationally and contribute consistently in the operation and development of the country (or post-modern Third World.
REFERENCES
- Eric Vergnaud, Economic Indicators and Financial Markets, Ed ESKA 2000, 330 p. - Note the current Capital Markets, March 2009; -Documents on the foreign exchange market, in March 2009; -Http: / / fr.wikipedia.org / wiki / Market Exchange, March 13, 2009; -Www.forex.fr, March 10, 2009; -www.brh.net/le change, March 24, 2009, CAPITAL MARKET
Theme: "The foreign exchange market it is vital in the functioning of a country"? Argue
INTRODUCTION
We live in a world today where adjustments are perpetual, which leads the advancement of technology constantly changes, and where industrial sectors such as countries seek to continually secure new advantages. In this context, the foreign exchange market as a trading and financial system and liberalized born to facilitate international trade and financial transactions through the exchange of currencies. With that, this market is clearly one of the best ways that can build momentum in favor of growth and prosperity of a country. However, it is essential that these actors adhere to a common set of rules and policies that are beneficial to the market to benefit from strong economic growth internationally.
Aucun commentaire:
Enregistrer un commentaire