Abstract
A money market is a financial market for financing with a maturity of less than one year. Compared to capital markets, the term for money market transactions is much shorter, and for this reason, the financial instruments of a money market have a higher liquidity and lower level risk than those of a capital market. Also, most of the financial instruments of a money market are fundamentally “quasi-money”. Another unique feature of money markets is that they are primarily wholesale markets in that the amount of each transaction is incredibly large, and it is precisely because of this that, unlike the majority of individual investors within stock and other long-term capital markets, money market participants are primarily financial institutions or industrial and commercial enterprises. Also, when the central bank engages in monetary policy operations, they will often participate in the money market, and for this reason, the money market plays an irreplaceable role in the monetary policy operations and the monetary policy transmission mechanism. Typically, the central bank will not directly participate in capital market transactions…
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