Financial Markets and Interest Rates
Presentation
Sustainable Development Goals
Learning Goals
Present the structure of financial markets and its importance for economic development . Identify the classification of different financial markets, their functions, features , tools and key stakeholders. Studying the behavior of interest rates , central variable of financial markets, and its relationship with other macroeconomic variables . Analyze the term structure of interest rates and investigate their significance in terms of financial market behavior forecasting and from the evolution of the economy.
Contents
1. THE FINANCIAL SYSTEM
1.1. The structure of financial markets
1.2. The financing of the economy
1.3. The yield curve
2. MONEY MARKET AND DETERMINATION OF SHORT-TERM INTEREST RATES
2.1. The market intervention operations
2.2 . The interbank money market
2.2.1 . The determination of the overnight rate
2.2.2 . The determination of the Euribor rates
3. CAPITAL MARKET
3.1. The banking operations interest rates
3.1.1 . Determination of passive interest rates
3.1.2 . The determination of lending rates
3.2 . The market shares and bonds
3.2.1 . Effects of monetary policy on the Stock Exchange
3.2.2 . Effects of monetary policy on the bond market
4. DERIVATIVE FINANCIAL MARKET
5. EXCHANGE MARKET
5.1. Basic concepts
5.2 . The determination of the exchange rate
5.3 . Parities interest rate
5.4. Interconnection with the money market
Teaching Methods
Exhibition , presentation and discussion of practical work , study real cases, application exercises
Assessment
- Final Examination
- Evaluation Board Frequency : combination of notes of two evaluation components , weighted equally :
- final test
- Work to present in on the scheduled date and in writing until the day of final test
- Feature Exam
Recommended Reading
1. ABREU, M., AFONSO, A., ESCÁRIA, V. e FERREIRA, C. (2012) Economia Monetária e Financeira, Escolar Editora, 2ª ed.. [336.76 ABR e]
2. BANCO CENTRAL EUROPEU (2011) The monetary policy of the ECB (em português, ed. 2004), Banco Central Europeu. [www.ecb.int]
3. BARATA, J. (2005) Moeda e Mercados Financeiros, 2ª ed., Edição do autor, ISEG. [(1998): 336.74 BAR m]
4. BODIE, Z., KANE, A. and MARCUS, A. (2011) Investments and Portfolio Management, 9ª edition, McGraw-Hill. [2008: 336.76 BOD i]
5. CECCHETTI, S. and SCHOENHOLTZ, K. (2014) Money, Banking and Financial Markets, 4ª ed., McGraw-Hill. [(2006) 336.7 CEC m]
6. CHISHOLM, A. (2002) An Introduction to Capital Markets: products, strategies, participants, John Wiley & Sons.
7. De HAAN, J., OOSTERLOO, S. and SCHOENMAKER, D. (2013) Financial Markets and Institutions: A European Perspective, 2ª ed., Cambridge University Press. [336.76 HAA f]
8. ELTON, E. e GRUBER, M. (2009) Modern Portfolio Theory and Investment Analysis, 8ª ed., John Wiley and Sons. [1995: 658.15 ELT m]
9. FONSECA, J. (2010) Economia Monetária e Financeira, Imprensa da Universidade de Coimbra. [336.74 FON e]
10. HAUGEN, R. (2000) Modern Investment Theory, 5ª ed., Prentice-Hall International Editions. [(1997): 658.15 HAU]
11. HOWELLS, P. e BAIN, K. (2008) The Economics of Money, Banking and Finance: A European Text, 4th ed., Addison Wesley Longman. [(1998): 336.7 HOW m]
12. LEÃO, E., LEÃO, P. e LAGOA, S. (2009) Política Monetária e Mercados Financeiros, Edições Sílabo. [336.71 LEA p]
13. MENDONÇA, A., FAUSTINO, H., BRANCO, M. e FILIPE, J. (1998) Economia Financeira Internacional, McGraw-Hill. [336.74 MEN e]
14. MISHKIN, F., MATHEWS, K. and GIULIODORI, M. (2013) The Economics of Money, Banking, and Financial Markets, 10ª ed., Prentice Hall. [(1994): 336.7 MIS e]
Teaching Staff (2023/2024 )
- Carlos Manuel Rodrigues Vieira [responsible]
