ECONOMICS
FOREIGN CURRENCY MARKETS
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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TRUE
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FALSE
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Either A or B
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None of the above
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Detailed explanation-1: -The eurocurrency market originated in the aftermath of World War II when the Marshall Plan to rebuild Europe sent a flood of dollars overseas. The market developed first in London, as banks needed a market for dollar deposits outside the United States.
Detailed explanation-2: -The Eurocurrency market began to develop in the 1950s, when the Eastern Bloc countries were afraid the United States might seize their holdings of dollars. It means that instead of depositing their dollars in the United States, they deposited them in Europe.
Detailed explanation-3: -A eurocurrency is: a bank deposit in a European currency held outside of Europe.
Detailed explanation-4: -Answer: D-The market where the borrowing and lending of currencies take place outside the country of issue. Explanation. The term “Eurocurrency Market” refers to the market where currencies are borrowed and lent outside of the country where they are made.