What is the Meaning of: International finance | Concept and Definition of: International finance
This field of finance can be divided into two branches of study: the international economy (taking into account the rate of Exchange, the interest rate and other financial aspects) and corporate finance (the study of markets and financial products).
Faced with the phenomenon of globalization, which implies the free movement of capital and the lifting of several types of constraints (physical, customs, tributaries), international finance has acquired particular importance.
An important concept in this context is that of currency, the national currency that can be converted into foreign currency in the foreign exchange market. To do this, there are the internal convertibility (the ability to buy and sell foreign currency in a country) and external convertibility (the contribution of a national currency in the markets of changes in other countries).
This exchange rate can be either fixed (when the Central Bank established the value of the currency and intervenes in the foreign exchange market) is flexible (because the Central Bank does not intervene in the market, the value of the currency is the subject of the law of supply and demand).
In addition, there is mention that is meant by balance of payments the balance of all economic transactions of a country with the rest of the world. This document lists all of the money that goes and out of a country through imports and exports of products, goods and services and capital transfers.