The characteristics of the currency market are as follows:

1. Short trading period. The shortest capital loan period is only one day, and the long one is generally no more than one year, mostly 3 to 6 months;

2. The purpose of the transaction is mainly the supply and demand needs of short-term capital turnover, and the general destination is To make up for the temporary shortage of working capital;

3. The trading instruments have strong liquidity. Therefore, the market for financing short-term funds is called the money market;

4. Financial instruments in the money market have strong "monetary nature" and have the characteristics of strong liquidity, stable prices, and low risks.

Market composition:

An efficient money market should be a market with breadth, depth and flexibility, with large market capacity, rapid information flow, low transaction costs and active transactions. It is sustainable and can attract many investors and speculators to participate.

The money market consists of six sub-markets: the inter-industry lending market, the bill market, the large negotiable certificate of deposit market (CD market), the treasury bill market, the consumer credit market and the repurchase agreement market.

Market type:

Bank short-term credit market. It refers to international interbank lending and a place where banks provide short-term credit funds to industrial and commercial enterprises. This market was developed in the process of capital internationalization, and its function is to solve temporary short-term liquidity shortages.

The lending periods in the short-term credit market vary in length. The shortest is daily split, usually 1 week, 1 month, 3 months and 6 months, and the longest is no more than 1 year. The interest rate is based on the London Interbank Offered Rate (LIBOR). The transaction method of this market is relatively simple. Deposits and loans are made through telephone calls every day, and loans do not require guarantees.

The short-term credit market for banks in my country is concentrated in the National Interbank Lending Center in Shanghai. Its interest rate is called the Shanghai Interbank Offered Rate (SHIBOR), which is also known as China's LIBOR. Eight varieties are released: overnight, one week, two weeks, one month, two months, six months, nine months, and one year. The quotation banking group consists of eighteen large banks.