The international money market is the market that handles the international currency transactions between the various central banks of the nations. In the international money market, the transactions are carried out mainly in gold or in US dollar.

The international money market is governed by the international monetary transactions between various nations currency. The international money market mainly handles the currency trading between the countries. The trading of one country’s currency for another one is also named as the foreign exchange currency trading or forex trading. The international money market has grown phenomenally over last few years and is expected to grow even more. It is the largest financial market in the world and the participants in this large market are large banks, central banks, governments, multinational corporations and currency speculators.

A money market is the safest financial market available and is commonly used by the big financial institutions, large corporations and governments. The investment made in a money market is generally for a very short period of time and hence they are often referred as cash investments. The basic performance of the international money market involves the money borrowing or lending by a government or some large financial institutions. Unlike share markets, the international money market deals with much larger fund and the players of the market are big financial institutes. The international money market allows investing in a less risk while the return that comes from that is also less. The best way to invest in the international money market is by money market mutual funds or treasury bills.

Everyday the international money market regulates a huge amount of international currency trading. According to the reports given by the Bank for International Settlements, the daily turnover in a traditional exchange market estimated is $1880 billion.

The major international money market participants are:

• Citigroup
• Deutsche Bank
• HSBC
• Barclays Capital
• UBS AG
• Royal Bank of Scotland
• Bank of America
• Goldman Sachs
• Merrill Lynch
• JP Morgan Chase

The international money market takes care of the exchange rates on a regular basis. Currency band, exchange rate regime, fixed exchange rate, linked exchange rate and floating exchange rates are some of the other indices that govern the international money market in a huge way.