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Rise and Rise of Protectionism

Today the primary reason why the global economic growth is at a thwarted state, is due to the rise of protectionism. It is potentially affecting the entire economic sentiment and this is forecasted by the market analysts to further intensify with the ongoing Trade war between US and China and others. Speaking from India’s perspective, the US protectionist strategy has definitely affected the Indian labour markets as well. This is mainly because, as maximum products exported under the Generalised System of Preferences (GSP) comprise of the micro, small and medium enterprises which are all labour-intensive sectors. Repeatedly, there is external shock witnessed relating to imminent withdrawal of duty-free access to US markets and this is a huge cause of concern for the Indian economy. In spite of positive prospects, the export sectors of India are unable to compete with the other nations globally due to the jitters caused by the external shocks prevailing in the market. The Prime
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How Knowing On Foreign Exchange Helps Importers & Exporters Make the Maximum of Foreign Trade?

Trade finance implies financial instruments and products that are used by companies or importers and exporters to facilitate global trade and commerce. It is trade finance which makes it possible and painless for the parties involved in the international trade to transact business through trade. Put simply, trade finance is a broad spectrum. Under it, a lot of things get covered such as- financial products that banks and companies deploy in order to make trade transactions achievable. In international/foreign trade transactions, the role of foreign exchange plays a pivotal role. The foreign exchange market is a huge global online network wherein buyers and sellers buy and sell currencies.   Foreign exchange depends on the value of the currency. And, as far as the valuation of currency is concerned, it again depends on a number of factors such as - trade, investment, tourism, and geopolitical risk. The foreign exchange market also represents central banks, commercial banks, br
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FOREIGN EXCHANGE AND RISK MANAGEMENT

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Foreign exchange involves conversion of one currency into other currency. Foreign exchange market is the biggest market in the world in terms of daily trading volumes. The value of one currency over other currency is determined by various factors like trade, investments, geo-political risk, country’s growth, etc. There is a risk involved in foreign exchange which is called exchange rate risk or currency risk. Investors and businesses exporting or importing goods and services or making foreign investments are exposed to exchange rate risk since their wealth is affected by movements in Foreign Exchange Risk Management . One of the exchange rate risks is transaction risk which is mainly associated with imports and exports. If a company exports goods on credit then amount it will finally receive depends on the Foreign Exchange movement from the transaction date to the settlement date. As group action risk contains a potential impact on the money flows of an organization, most compan
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Let’s Know About Forex Services – Ten Stereotypes, Five Doubts and Fifteen Your Competitors

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The forex service provider is a firm that furnishes smoother access to a trading platform that allows you to buy and sell foreign currencies. It acts as an intermediary between you and the interbank system. Ten common Myths you might have come across about Forex services are as follows: Forex services are based out only in large financial cities Forex services require a vast amount of money The services are not transparent  The service providers are not well experienced The forex services are not convenient and timely Forex services are only for traders There is no one-stop shop for forex services The forex service provider does not educate its clients The provider makes money trading against their customers Forex service is full of fraud The above are firm stereotypes in accordance with the good service provider you choose, whereas these myths might stand as facts with the bad service provider. Thereby your success or failure depends on choosing a genuine Forex
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Foreign Exchange and Risk Management

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The term Foreign exchange implies two things; they are foreign currency and exchange rate. Foreign currency is any foreign nation’s currency which is authorized medium of circulation and the basis for record keeping in that country. An exchange rate is the value of a nation’s currency in terms of another currency. The strengthening of the globalization process has led to a rise in foreign exchange transactions in international financial markets. This has set on higher volatility of exchange rates and has absolutely increased foreign exchange risk. There are numerous types of risks involved, however only a few can bring losses as massive as foreign exchange risk. In these conditions, the demand for new modern and effective methods for managing foreign exchange risk becomes a great necessity for the parties in international foreign exchange activity. Foreign Exchange Risk Management is crucial for firms frequently trading in the international market. Coping with risk has therefo
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Most Effective Ways to Overcome Forex Money Management’s Problem

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The Foreign Exchange Currency market is the second largest financial market in terms of volume. The volatility in the currency market makes it a risky one. This Forex risk has become a key challenge for the treasury department. The currency rates fluctuate between the transaction date and cash flow date, and an unfavorable movement could compromise the profitability of the transaction. The effective ways to manage the Forex Money Management risk are – Check the Forex conversion rates offered by banks - online, newspapers, etc give delayed rates and not real time data. Banks charge high margins, leaving very little profits for small companies. In order to keep the focus on corporate finances, the Finance Manager may outsource the corporate Forex transactions. Regularly conduct training for existing finance team to get them up the curve to handle Forex transactions better with the ever changing market conditions. Have hedging strategies in place – through currency forwards, fu
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Trade Finance Services is so famous, but why?

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While trading overseas there is a burden on a business cash flow along with delays and complications. One needs to keep a track of freight charges and tariffs to ensure there is no loss associated while trading overseas. Trade financing or import financing service specializes in overcoming these challenges and also spares the working capital for investing in the growing businesses. Trade finance Services helps to bridge the funding gap between a credit order and the payment to an overseas supplier. This eases the cash flow pressure. There are two types of credit facility to the importer – buyer’s credit and supplier’s credit. Buyer’s credit finance means finance for payment of imports arranged by the importer from a bank or a financial institution outside the country. The finance is based on a guarantee given by the importer’s bank. Supplier’s Credit has credit extended directly by the overseas supplier (exporter) to the buyer (importer) instead of a bank or a financial i
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