Mercados Monetários e Cambiais

400056

NOVA Information Management School

3.0

João Miguel da Silva Lourenço

Portuguese. If there are Erasmus students, classes will be taught in English

To be able to analyze links between Money and Foreign Exchange markets and how they work;
To know how Central banks intervene in financial markets and their influence in setting interest rates and foreign exchange rates;
Know what are the most used indexing benchmarks and how they are used;
To know how foreign exchange rates are determined and analyze arbitrage possibilities.

None

I. Functions and Organization of the Money Market

1. Money Market in the financial system

2. The role of the Bank of Portugal and European Central Bank and intervention methods

3. Concept and role of market makers

4. Financial brokers

5. Trading methods

6. Index bechmarks: Libor, Euribor

II. Money Market and Financial Intruments

1. Intervention instruments and policies of the European Central Bank

2. Corporate funding instruments linked to the money market: commercial paper and hot money

III. Foreign Exchange market (Spot)

1. Brief history

2. Players and financial brokers

3. Role of central banks

4. Foreign Exchange areas

5. Describing operations

6. Financial information

7. Cross rates

Choudhry, Moorad - The Money Markets Handbook: A Practitioner's Guide (2011), Wiley.
Wachtel, Cliff - The Sensible Guide to Forex: Safer, Smarter Ways to Survive and Prosper from the Start (2012), Wiley.
Choudhry, Moorad - The Bond & Money Markets, Strategy, trading, analysis.
Stigum, Marcia & Crescenzi, Anthony – Stigum’s Money Market.
Weithers, Tim – Foreign Exchange: A Practical Guide to the FX Markets.

Classes have mainly a practical content. Most subjects are presented through small cases and short exercises.

The evaluation system includes:

1. Case solving and participation in class (20%);

2. Final Exam (80%)