ECU interest rates and ECU basket adjustments: an arbitrage pricing approach

Article Abstract:

The European bonds market is subject to constant basket adjustments because of the various monetary systems, different inflation rates and economic policies of the different European nations. These adjustments have a direct bearing on the interest rates and bond prices of European Currency Unit (ECU) securities. The arbitrage pricing theory and the standard continuous time trading model or the geometric Brownian motion model, were used on the ECU basket ajdustments problems. The results affirm that ECU basket readjustments in favor of weak currences will increase ECU interest rates.

Euro (Currency), Bonds, Bonds (Securities)

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The international transmission of Eurodollar and US interest rates: a cointegration analysis

Article Abstract:

Three factors have altered the structural relationship between US and Eurodollar interest rates in the 1980s. The increased size of the Eurocurrency market, more rapid movements toward deregulation in the European market and the enhanced arbitrage opportunities via the swap and futures markets account for the change from a unidirectional causality from the US to Europe in the early 80s to a reverse causality in the latter part of the decade. This implies that US financial markets are no longer exempt from the impact of changes occurring in foreign markets.

Eurocurrency market, Certificates of deposit

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The design of financial systems: an overview

Article Abstract:

Financial system design has become significant as the importance of financial services in developed economies continues to grow and as evidence that this design may influence real decision increases. Financial systems differ from country to country in many dimensions. For instance, the intermediated/institutional segment of the financial system takes precedence in Europe and Japan, while in the US, financial markets are more important.

Finance

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