Category: Interest Rates

International interest rates and the direction of monetary policy are the most important factors in determining trends in the Forex market. One can infer market direction from monetary policies (through movements in equity and bond markets), various economic reports and central bank reports. In order to understand the behavior of Forex markets, merely knowing the trends in international interest rates is not sufficient. One should understand the future direction of monetary policies to understand currency markets.[br]

 

A Certificate of Deposit (CD) is a fixed income instrument. Investing in CDs is one of the safest and reliable ways to earn stable income. CD interest rates are lower when compared to other investment vehicles such as stocks, Forex and commodities. Individuals and institutional investors can invest in CDs to diversify their assets. Unlike a savings account, a CD is not a very liquid asset and one need to pay penalties if the money is withdrawn before maturity.[br]

 

The interest rate on a loan is dependant on several factors including the base rate, the nature of the loan, the duration and the amount of the loan, besides the agreement between the lender and the borrower. An Interest Rate Loan may be fixed or floating depending on the terms and conditions agreed upon by the lender and the borrower.[br]