Monday, 10 May 2010

Balance of payments and exchange rates -----Eileen 07/05/2010

The balance of payments accounts are a record of the international transactions of the economy .the current account records trade in goods and services as well as transfer payments. The capital account in goods records purchases and sales of asserts.
The overall balance-of-payments surplus is the sum of the current and capital accounts surpluses. If the overall balance is in deficit, we have to make to us. The foreign currency for making these payments is supplied by central banks.
Partically increases/decrese in debt the reserves of gold and foreign exchange money inflows economy.
The capital account include the financial account such as investment,direct ,protifillio(save money need investment)other financial flows (main short term)bring money .and financial derivatives (cash market ,you pay cash to today)and in vestment ,flow to and from reserves (official balance).

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