money market an introduction

Prof. Dr AP Faure
Money Market: An Introduction
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2

AP Faure
Money Market: An Introduction
Download free eBooks at bookboon.com
3

Money Market: An Introduction
1
st
edition
© 2013 Quoin Institute (Pty) Limited &
bookboon.com
ISBN 978-87-403-0586-9
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Money Market: An Introduction
4
Contents
Contents
1 Context: the nancial system 8
1.1 Learning objectives 8
1.2 Introduction 8
1.3 e nancial system 9
1.4 Allied participants in the nancial system 19
1.5 Summary 19
1.6 Bibliography 20

2 Overview 21
2.1 Learning objectives 21
2.2 Denition 21
2.3 Primary money market: supply of and demand for short-term funds 30
2.4 Organisational structure of the money market 36
2.5 Money (deposit) creation in the money market 39
2.6 Interbank deposit / loan market 42
2.7 Money market interest rates 44
2.8 Money market derivative markets 46
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Money Market: An Introduction
5
Contents
2.9 International aspects of the money market 46

2.10 Economics of the money market 48
2.11 Summary 50
2.12 Bibliography 50
3 Interbank market & monetary policy 51
3.1 Learning outcomes 51
3.2 Introduction 52
3.3 Bank to central bank interbank market (required reserves) (b2cb IBM) 53
3.4 Bank to bank interbank market at the nal interbank clearing
(reserve funds market) (b2b IBM) 55
3.5 Central bank to bank interbank market (liquidity shortage) (cb2b IBM) 61
3.6 e money market identity / analysis 71
3.7 Bank to bank interbank market revisited 73
3.8 Summary 73
3.9 Bibliography 74
4
Mathematics 75
4.1 Learning objectives 75
4.2 Introduction 75
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