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Why You Should Care About Peripheral Yields
In a Forex context, “peripheral yields” generally refers to the yields on bonds issued by countries in the EU “periphery”. They were closely followed by traders around the 2011 financial crunch, and have since been somewhat forgotten. However, they are still an important and useful tool for forex traders, especially those who trade the euro. Let’s take a closer look at how peripheral yields are related to currency moves. Bond yields are directly related to the value of currencies. The differences in interest rates influence the prices and interest paid on bonds. This, in turn, drives demand for currencies. ... (full story)