Eurodollar

As a Euro Denominated in U.S. dollars bank deposits with a maturity are called up to six months that lie at banks outside the United States. These deposits are not subject to the control and the minimum reserve policy of the Federal Reserve Bank ( Fed), whereby higher interest rates may be paid to depositors.

The Euro -dollar market is part of the euro money market, which forms the Euro market with the euro credit market and the euro capital market. The Euro market should not be confused with the common European currency Euro.

The emergence of the Euro -dollar market in the 50s of the 20th century is due to the growing trade deficit of the United States and the Marshall Plan, which resulted in the assets increased continuously in U.S. dollars outside the U.S.. Logically euro dollar deposits are counted for the M3.

• U.S. currency