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A forex market works basically through an Inter-Bank or an Inter-Dealer
market. It came up when floating rates were first implemented back in 1971 and
taken up well by the market. A layman understands the market as the place where
the foreign currencies are exchanged with other currencies. The $300bn daily
turnover in the US Treasury bond market is itself an evidence of the fact how
great is the magnitude of this industry. In 1992 Wall Street Journal (WSJ)
estimated the size of the market at a whooping $1 Trillion whereas to by the
recent claims, markets have swelled up to as much as $3.2 Trillion.
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