Glossary

Refers to sustained rise in asset prices.

Difference between two countries' benchmark interest rates, often used as a basis for forecasting exchange rates.

The percentage of gained or lost on an investment relative to the amount of money invested.

General slowdown in economic activity over a sustained period of time, or a business cycle contraction. Defined by the National Bureau of Economic Research as two consecutive quarters of falling GDP.

A currency pair involving the US Dollar where the US dollar is not the first currency quoted. For example, the euro is the base currency when paired with the US dollar.

Any market or exchange monitored by a government agency with the goal of protecting investors.

A technical indicator that measures the velocity and magnitude of directional price movement by comparing upward and downward close-to-close movement. Referred to as a momentum oscillator.

Central Bank for Australia, whose actions bear directly on the Australian Dollar.

Central bank for New Zealand, whose action directly influence the value of the New Zealand dollar (NZD)

Any currency that is perceived as stable or reliable, meaning that central banks are willing to hold it in mass quantities. The US Dollar is currently the world's foremost reserve currency.

Measures inflation based upon the price of a selection of family goods.

Daily calculation of unrealized P&L (on open positions) based on the difference between the previous closing price and the current opening price. Also refers to a change in a country's exchange rate for a currency as a result of central bank intervention or other official action.

Refers to the use of financial instruments to manage exposure to risk, particularly credit risk and market risk.

Simultaneous closing of an open position for today's value date and the opening of the same position for the next day's value date at a price reflecting the interest rate differential between the two currencies.