A vibrant Primary Dealership system will not only deepen the inter-bank FX market, but will also enhance liquidity management. Exchange rate movements are determined by demand and supply for the currencies over time, based on trade value, capital flows and market expectations. How much of the market is covered by non-bank dealers? However, foreign exchange activity does not flow evenly. The value (price) of one currency in terms of another currency is known as the ‘foreign exchange rate’. The Foreign Exchange Primary Dealers (FXPDs) system is one Thiagarajar School of Management - South India's Proficient Bschool 40-50%. … Definition: The foreign exchange market or the ‘forex market’, is a system which establishes an international network allowing the buyers and sellers to carry out trade or exchange of currencies of different countries.A forex market can be stated as one of the most liquid financial markets which facilitate ‘over-the-counter’ exchange of currencies. The Nigerian FX market consists of two dealing segments: 1. One of such efforts is to deepen the inter-bank FX market by establishing an institutional framework for Primary Dealership in FX products. The FX market is a market for trading and exchanging any currency pair. Over the course of a day, there is a cycle characterized by periods of very heavy activity and other periods or relatively light activity. The Minister of Finance has appointed certain banks to act as Authorised Dealers in foreign exchange that gives such banks the right to buy and sell foreign exchange, subject to conditions and within limits prescribed by the Financial Surveillance Department. encompasses the conversion of purchasing power from one currency into another, bank deposits of foreign currency, the extension of credit denominated in a foreign currency, foreign trade financing, and trading in foreign currency options and futures contracts .

Authorised Dealers are not the agents of Financial Surveillance Department but act on behalf of their customers. Foreign exchange dealers market and sell monetary exchange strategies to clients, as well as conduct currency exchanges themselves. Give a full definition of the market for foreign exchange! The foreign exchange market place is a twenty-four hour market with exchange rates and market conditions changing constantly.