Foreign exchange market
by business & economics research advisor, from the library of congress

the characteristics of the fx market that make it so unique are: the volume of trading, liquidity of the market, geographical dispersion, the 24 hours trading day (except on the weekends), the number and variety of market traders, and the factors that affect the exchange rate. this market has a number of marketplaces where currencies are traded at different rates. to avoid exploitation by arbitragers, difference in rates are usually kept at a minimum. banks all over the world are involved in foreign exchange trading, but the main trading centers are located in tokyo, london and new york, allowing the market to remain open 24 hours a day; when asian trading is ending, european trading is starting, and u. s. trading ends the daily session. traders do not have to wait for the market to open. monetary flows and economic changes such as gdp growth, interest rates, inflation, and budget and trade deficits or surpluses, cause fluctuations in the exchange rate. because news affecting foreign exchange is well publicized, insider information is almost nonexistent in the fx market.
one factor causing fluctuation in the exchange rate is
a) interest rates.
b) lack of weekend trading hours.
c) insider information by arbitragers.
d) geographical dispersion of the fx market.