Академический Документы
Профессиональный Документы
Культура Документы
Section A
1. Indias current account deficit (CAD) narrowed sharply to USD 0.3
billion, or 0.1 per cent of GDP, in the fourth quarter of 2015-16 from
USD 7.1 billion, or 1.3 %. So, as CAD narrows down Indias deficit as
far as Trade is concerned is reducing.
3. The most popular and crudest measure is the bid-ask spread; this is
also called width. A low or narrow bid-ask spread is said to be "tight" and
tends to reflect a more liquid market. Depth refers to the ability of the
market to absorb the sale (exit) of a position.
13. FII flows, Brexit, Negative yields in many countries, general bearish
outlook of the global economy contributed to somewhat roller coaster
ride for INR. With US waiting to raise the interest rates and FCNR flows
likely to happen in the near future, the rupee possibly could see a
depreciation of about 3 to 4% from the current levels till March 2017.
14. Forwards, Futures, Options and Swaps (with example for each
product)
18. Lead, Lag strategies depending upon the strength of the currencies,
strategies for blocked funds, netting,
19. The most obvious argument is that all developed countries are capital
account convertible; hence this is an inevitable destiny of the developing
countries in their path to development.
Free global capital flows bring about better and more efficient allocation
of the global pool of savings to the more productive uses. From the
developing countrys viewpoint, free access to global capital markets
increases available investible resources which augments domestic
savings, reduces marginal cost of capital, accelerates investment and
growth.
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Section D
1. What is your interpretation of the data given above? (5 marks)
2. How would you use the data for managing transaction exposure risk ?
(5 marks)