International Finance (IMB)

The main objective of the course is to give participants a focused overview of international finance issues at the global level. The course is designed to combine both a practical and theoretical approaches to global finance. It will put participants of the course on the position of an investment analyst. The mathematical context of the course will be kept to a minimum, with the main focus being on institutional aspects as well as on practical application.

After the course, participants will be able to:
• interpret the key concept in international finance,
• manage specific international finance risks (country risk and foreign exchange risk), and
analyse the relationship of international capital flows to other macroeconomic aggregates, and institutional aspects of various types of international capital flows

Basic concepts in international finance
• Balance of payments account and analyses
• Exchange rates and exchange rate policies
• Foreign exchange markets and forecasting
• International parity conditions
• International monetary system: concept and evolution
• Current account imbalances and new global financial governance

Foreign exchange risk and its management
• Foreign exchange markets
• International parity conditions and foreign exchange forecasting
• Instruments for managing foreign exchange risk (futures, options, currency swaps)

Country risk and financial vulnerability analysis – importance of credit ratings
• Concept and analytical framework for measuring country risk
• Credit rating agencies and their importance

International capital flows : concept and main patterns
• International capital flows and macroeconomic aggregates
• Classification, volume and structure of international capital flows
• Liberalization of international capital flows
• Main patterns of financial flows

Official versus private capital flows by institutions and instruments
• Official flows (multilateral financial institutions and bilateral official sources)
• Private flows (euro-financial market, syndicated loans, Eurobonds)