International Financial Flows and Exchange Rates

What this note covers

1. The Nature of International Financial Flows
2. Growth of International Financial Flows
3. Exchange Rate Determination and the Link to Financial Flows
4. Role of Derivatives in Exchange Rate Risk Management
5. FDI: Drivers, Trends, and Exchange Rate Effects on Australia
6. Portfolio Investment, the 'Carry Trade', and Exchange Rate Volatility
7. Policy Implications and Australia's Vulnerability to Financial Flow Volatility

7 sections · 14 key terms & formulas · 6 common mistakes