ECONOMICS
FOREIGN CURRENCY MARKETS
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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EUROYEN
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EURODOLLARS
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EUROBOND
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None of the above
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Detailed explanation-1: -Eurodollar. Eurodollars were the first eurocurrency, and they still have the most influence. It is worth noting that U.S. banks can have overseas operations dealing in eurodollars. These subsidiaries are often registered in the Caribbean.
Detailed explanation-2: -The term eurocurrency refers to currency deposits held at banks outside of their country of origin. The most famous example of eurocurrency is the eurodollar, which involves U.S. dollar (USD) deposits held outside the United States.
Detailed explanation-3: -The inception of eurocurrency occurred in London with the introduction of the Eurodollar in 1955. Even after eurocurrency had expanded globally however, London maintained its position as the centre of the Eurodollar market which is still true of today.
Detailed explanation-4: -It is a general term that applies to all currencies that are deposited anywhere outside of its local country. For example, if you deposit Japanese yen at a bank in the United States, it is considered to be Eurocurrency.
Detailed explanation-5: -A eurocurrency is: a bank deposit in a European currency held outside of Europe.