Financial foreign exchange

Financial foreign exchange

According to the source and use of foreign exchange, it can be divided into trade foreign exchange, non-trade foreign exchange and financial foreign exchange.

Financial foreign exchange refers to the foreign exchange in the form of certain financial assets. For example, the foreign exchange traded between banks does not come from or is used for trade activities, but rather the management of financial assets in the process of various currency positions; for example, the foreign exchange of capital transfer between countries, whether indirect investment or direct investment, appears in the form of financial assets expressed in the currency of a certain country.

Financial foreign exchange is different from trade foreign exchange and non-trade foreign exchange, which belongs to a kind of foreign exchange of financial assets, such as interbank trading foreign exchange, which is neither derived from visible trade or intangible trade nor used for tangible trade, but is for the management and manipulation of various currency positions. The transfer of capital between countries should also occur in monetary form, or indirect investment or direct investment, all of which form financial assets flowing between countries, especially the large amount of international hot capital, the frequency of transactions and the profound impact, which cannot but attract special attention from the parties concerned.