In the present study, we argue that the difference between Eurodeposit
and domestic deposit rates is based on differences in the risk premia embedded in the respective rates rather than cost advantages.
During most of January, therefore, differentials in three-month Eurodeposit
rates, as well as those in the expected three-month deposit rates implied by futures prices, moved in the mark' s favor.
* Currency Market Analysis, providing constant insight into the global foreign exchange and Eurodeposit