Exchange rate defined as the value of one country's currency expressed in another country's currency. The exchange rate is necessary for currency exchange when trading goods and services, movement of capital and loans; to compare prices on world commodity markets, as well as cost indicators different countries; for periodic revaluation of foreign currency accounts of firms, banks, governments and individuals.
Exchange rates are divided into two main types: fixed and floating.
The fixed exchange rate fluctuates within a narrow range. Floating exchange rates depend on market demand and supply of currency and may fluctuate significantly in magnitude.
The fixed exchange rate is based on currency parity, i.e., the officially established ratio of monetary units of different countries. Under monometallism - gold or silver - the base of the exchange rate was monetary parity - the ratio of monetary units of different countries according to their metallic content. It coincided with the concept of currency parity.
Under gold monometallism, the exchange rate was based on gold parity - the ratio of currencies according to their official gold content - and spontaneously fluctuated around it within the limits of gold points. However, with the abolition of the gold standard, the gold dot mechanism ceased to function.
IN modern conditions The exchange rate is based on currency parity - the relationship between currencies established by law, and fluctuates around it.
In accordance with the amended IMF Charter, currency parities can be established in SDR or other international currency unit. A new phenomenon since the mid-70s has been the introduction of parities based on a currency basket. This is a method of measuring the weighted average exchange rate of one currency against a specific set of other currencies. The use of a currency basket instead of the dollar reflects the trend away from the dollar to a multi-currency standard.
The development of foreign economic relations requires a special tool through which entities acting on international market, could maintain close financial cooperation with each other. Such a tool is banking operations for exchanging foreign currency. The most important element in the system banking operations with foreign currency is the exchange rate, since the development of IEO requires measuring the value relationship between the currencies of different countries.
The exchange rate is required for:

· mutual exchange of currencies when trading goods, services, during the movement of capital and loans. The exporter exchanges the proceeds foreign currency to a national one, since the currencies of other countries cannot circulate as a legal means of purchase and payment on the territory of a given state. The importer exchanges national currency for foreign currency to pay for goods purchased abroad. The debtor purchases foreign currency for national currency to repay debt and pay interest on external loans;

· comparison of prices on world and national markets, as well as cost indicators of different countries, expressed in national or foreign currencies;

· periodic revaluation of foreign currency accounts of companies and banks.
Exchange rate- this is the exchange ratio between two currencies, for example 100 yen per 1 US dollar or 16 Russian rubles per 1 US dollar, 440 Armenian drams per 1 dollar.
Hypothetically, there are five exchange rate systems:

· Free (“clean”) swimming;

· Guided swimming;

· Fixed rates;

· Target zones;

· Hybrid exchange rate system.
Thus, in a free floating system, the exchange rate is formed under the influence of market demand and supply. At the same time, the foreign exchange forex market is closest to the model of a perfect market: the number of participants, both on the demand side and on the supply side, is huge, any information is transmitted in the system instantly and is available to all market participants, the distorting role of central banks is insignificant and inconsistent.
In a managed floating system, in addition to supply and demand, the exchange rate is strongly influenced by the central banks of countries, as well as various temporary market distortions.
An example of a fixed exchange rate system is Bretton Woods. monetary system 1944-1971

The target zone system develops the idea of ​​fixed exchange rates. An example of this is fixation Russian ruble to the US dollar in the corridor of 5, 6-6, 2 rubles per 1 US dollar (in pre-crisis times). In addition, the mode of functioning of the exchange rates of the participating countries of the European Monetary System can be attributed to this type.
Finally, an example of a hybrid exchange rate system is the modern currency system, in which there are countries that freely float the exchange rate, there are zones of stability, etc.

What is currency and exchange rates?

Currency and money are synonyms (). Currency can be foreign or Russian. Russian currency– this is the ruble, which is the only legal tender that must be accepted at face value throughout Russia. Foreign currency includes banknotes in the form of banknotes, treasury notes, as well as coins that are in circulation and are legal means of cash payment in the territory of the relevant foreign state. It should be noted that currency can be not only cash, but also non-cash, that is, existing not in the form of banknotes or coins, but in the form of entries in bank accounts.

Currency can be convertible or non-convertible. Convertible is a currency that can be exchanged for another without the special permission of any government agencies. Thus, the US dollar is freely convertible, Japanese yen, euro and some others - these include the Russian ruble.

But in order to exchange one currency for another, you need to know its exchange rate, in other words, its price. An exchange rate is the price of a country's currency expressed in another country's currency. In other words, currency is a commodity like any other, and can be purchased at a set price. Rubles can be bought for US dollars, euros, yuan, and vice versa. And for each currency used as a means of payment for another currency, a certain exchange rate is established.

Wherein dollar exchange rate or euro exchange rate, and any other currency can be either official (fixed and floating) or unofficial. The official exchange rate for the national currency is set by the government, usually represented by the central bank, for a certain period, for example, a day, and is used in official calculations. The unofficial rate may differ from the official one when making payments between ordinary citizens or legal entities at our own discretion.

A fixed rate is an officially established relationship between currencies. Thus, a fixed exchange rate between the dollar and the ruble was used in the USSR; it was established by the State Bank of the USSR. For example:

• on January 1, 1924, the exchange rate of $1 was equal to 2.20 rubles;
• on January 1, 1936, the exchange rate of $1 was equal to 1.15 rubles;
• on January 1, 1937, the exchange rate of $1 was equal to 5.04 rubles;
• on January 1, 1961, the exchange rate of $1 was equal to 0.90 rubles.

Interestingly, in the early 1990s, there were several types of exchange rates in parallel:

1

Official fixed (established by the State Bank of the USSR and used for official settlements);

2

Commercial (was established on November 1, 1990 based on the ratio of 1.8 rubles per $1 and was used for settlements on foreign trade operations, foreign investments in the USSR and Soviet investments abroad, as well as non-trade settlements carried out by legal entities (Presidential Decree USSR dated October 26, 1990 No. UP-943 " "));

3

“Tourist” (was introduced on July 24, 1991 by the State Bank of the USSR at the level of 32 rubles per $1, this type of rate lasted only five months and was used along with the official fixed rate for the purchase of currency by individuals (Telegram of the State Bank of the USSR dated April 1, 1991 No. 135/91 " ").

The record low value of the official dollar exchange rate was recorded on February 13, 1991 - its official rate was 0.54 rubles. Such a low official dollar exchange rate lasted until June 24, 1992, reaching by that time only the level of 0.56 rubles.

Already on July 1, 1992, the official dollar exchange rate was set at 125.26 rubles. for $1 and began to grow sharply, reaching an amount of 414.50 rubles by January 1, 1993, and 1,247 rubles by January 1, 1994. By January 6, 1995, the dollar to ruble exchange rate increased to 3,623 rubles, and by January 5, 1996, to 4,461 rubles, reaching a value of 5,960 rubles by the end of 1997. for $1, after which the ruble was redenominated a thousand times in Russia.

However, even after this, the dollar/ruble exchange rate continued to grow steadily, showing sharp rises in 1998 and 2014. A certain stability and even some periodic depreciation of the dollar could be observed from 2000 to 2013. As of December 9, 2014, the US dollar exchange rate was set at 53.31 rubles. for $1. If compared with previous, non-denominated rubles, it corresponds to the rate of 53,310 non-denominated rubles per $1. Thus, for the period from July 1, 1992 to the present, the value of the ruble against the US dollar has fallen 424 times.

Currently, Russia uses a floating exchange rate, which involves the use of a market mechanism currency regulation to set exchange rates. At the same time, it changes under the influence of supply and demand.

The Bank of Russia is responsible for establishing official exchange rates against the ruble (Article 53 Federal Law dated July 10, 2002 No. 86-FZ ""). However, an ordinary citizen cannot come to the Bank of Russia and buy or sell currency at the official rate. Moreover, the Bank of Russia does not undertake any obligation to buy and sell currency at the official rate. In fact, citizens can only purchase currency in commercial banks at the unofficial rate, and the price of the currency is usually overestimated - after all commercial Bank makes a profit from this transaction.

Therefore, it is believed that citizens are not recommended to “play” with exchange rates (at least in the short term, without being able to save money for years in advance), since they are always forced to buy currency at a higher price and sell it at a lower price than at the official rate, practically always losing on this difference.

Dollar rate for today and euro rate for today

Most Popular exchange rates that interest Russians almost every day are dollar and euro to ruble exchange rates. Unfortunately, the ruble has fallen sharply against these currencies recently. According to many analysts, this was a consequence of Russia's domestic and foreign policies. Currently, the fall of the ruble continues and it is completely unclear at what level it will stop.

Of course, such a decline cannot but affect the well-being ordinary Russians. Since prices in stores rise following the increase dollar and euro exchange rates(since many goods are purchased abroad for foreign currency), then purchasing power The income received by citizens falls proportionally. And if an employee at the beginning of 2014 could buy with his salary in the amount of 30 thousand rubles. goods worth the equivalent of approximately $920, then now purchasing power his wages fell to about $565, ​​that is, almost twice. Of course, Russians are very worried about this situation.

As a result, most citizens monitor daily dollar exchange rate for today And euro exchange rate for today, depending on which of these currencies seems more important to them. But few people know exactly how this rate is set.

The fact is that dollar exchange rate for today set by the Bank of Russia the day before. In fact, every day the dollar exchange rate for tomorrow is set. Official US dollar to ruble exchange rate calculated and established by the Bank of Russia based on quotes from the interbank domestic foreign exchange market. From April 15, 2003 to establish official dollar exchange rate weighted average is used US dollar exchange rate at the auctions of the Unified Interbank Trading Session currency exchanges with a settlement deadline of “tomorrow”, as of 11:30 a.m. on the trading day (Information from the Bank of Russia dated April 14, 2003).

Thus, dollar rate for tomorrow is set by the Bank of Russia daily (on weekdays) at 11:30 a.m. of the trading day based on the average value of its value at exchange trading.

The same way, euro exchange rate for today was established by the Bank of Russia yesterday, but using a different algorithm. Euro exchange rate for tomorrow determined not directly, by the average value at auction at a certain time, but on the basis of already set rate dollar for tomorrow, taking into account the quotes of the euro against the US dollar on international foreign exchange markets and in the interbank domestic foreign exchange market.

In total, the Bank of Russia sets daily rates for 34 foreign currencies - all of them are available on its official website, and the rates of the US dollar and euro can also be found on the GARANT.RU portal.

Economic transactions between participants international relations impossible without exchanging one national currency for another. The proportion in which the currency of one country is exchanged for the currency of another is called the exchange rate. In other words, every foreign monetary unit has a currency rate - price expressed in the national currency of another country.

The exchange rate is necessary for currency exchange when trading goods and services, movement of capital and loans; to compare prices on world commodity markets, as well as cost indicators of different countries; for the periodic revaluation of foreign currency accounts of firms, banks, governments and individuals. The exporter exchanges the proceeds of foreign currency for national currency, since the currencies of other countries cannot circulate as a legal means of purchase and payment in the territory of a given state. The importer exchanges national currency for foreign currency to pay for goods purchased abroad.

Exchange rates are divided into two main types: fixed and floating.

The fixed exchange rate fluctuates within a narrow range. Floating exchange rates depend on market supply and demand for a currency and can fluctuate significantly in value.

The fixed exchange rate is based on currency parity, i.e. officially established ratio of currencies of different countries. Under monometallism - gold or silver - the base of the exchange rate was monetary parity - the ratio of monetary units of different countries according to their metallic content. It coincided with the concept of currency parity.

Under gold monometallism, the exchange rate was based on gold parity - the ratio of currencies according to their official gold content - and spontaneously fluctuated around it within the limits of gold points. The classic mechanism of gold points operated under two conditions: free purchase and sale of gold and its unlimited export. The limits of exchange rate fluctuations were determined by the costs associated with transporting gold abroad, and actually did not exceed +/- 1% of parity. With the abolition of the gold standard, the gold dot mechanism ceased to function.

The exchange rate with fiat credit money gradually broke away from the gold parity, as gold was forced out of circulation into treasure. This is due to evolution commodity production, monetary and currency systems. Until the mid-70s, the exchange rate was based on the gold content of currencies - the official scale of prices - and gold parities, which were fixed by the IMF after the Second World War. The measure of the relationship between currencies was the official price of gold in credit money, which, along with commodity prices, was an indicator of the degree of depreciation national currencies. Due to the gap between the official, state-fixed price of gold and its value for a long time, the artificial nature of gold parity has intensified.

For more than 40 years (1934-1976), the price scale and gold parity were established on the basis of the official price of gold. Under the Bretton Woods monetary system, due to the dominance of the dollar standard, the dollar served as the reference point for the exchange rates of other countries.

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In a country that has developed historically and is enshrined in national legislation.

The monetary system includes the following elements:

• monetary unit - a monetary sign established by law, which serves to measure and express the prices of goods;
• types of money that are legal tender - credit bank notes (cash and non-cash), paper money (treasury bills and notes), small change bill coins;
• money supply - the sum of cash and non-cash Money, as well as other means of payment;
• emission system - the procedure for issuing bank and treasury notes central banks and treasuries and issuance channels;
• monetary policy - totality monetary instruments(options money supply, reserve norms, interest levels, loan terms, refinancing rates, etc.) and institutions monetary regulation (central bank, Ministry of Finance).

The type of monetary system depends on the form of functioning of money - or signs of value. In the process of evolution of forms of money and monetary relations, two types were formed monetary systems(Fig. 2.1).

Rice. 2.1. Typology of monetary systems

Metal money systems - These are systems based on metal money with internal (real) value, including mono- and bimetallic.

- a monetary system in which one monetary metal acts as a universal equivalent. Developed monometallic monetary systems were historically established on the basis of copper, silver, and gold. Copper monometallism existed in Ancient Rome in HI-II centuries. BC. For a long time, copper money formed the basis money circulation in Russia. Silver monometallism in Russia developed as a result of the Kankrin monetary reform (1843-1852), in Holland (184-1875), in India (1852-1893), and in China it existed until 1935.

At the end of the 19th century. In most countries, silver depreciated due to the expansion of its extraction from polymetallic ores. At the same time, new gold deposits were discovered, which led to the transition to gold monometallism. For the first time, gold monometallism as a type of monetary system developed in Great Britain and received legislative recognition in 1816. At the end of the 19th century. gold monometallism is being introduced in Germany, France, Norway, Denmark, Austria, Russia, Japan, and the USA. There are three types of gold monometallism: gold coin, gold bullion and gold exchange standards.

- a monetary system in which the role of universal equivalent is assigned to two noble metals (usually gold and silver), and the free minting of coins from both metals and their unlimited circulation are provided. Under bimetallism, the ratio between gold and silver coins is established depending on the market price of monetary metals. This system existed in the XIV-XVII centuries. Three types of bimetallism are known:

• parallel currency system - the ratio between gold and silver coins was established spontaneously;
• dual currency system - the state fixed the ratio between metals, and the minting of gold and silver coins and their acceptance by the population were carried out according to this ratio;
• "lame" currency system - gold and silver coins were legal tender, but not equal conditions. Silver served as a substitute for gold coins in circulation, and was also used as a small change.

The legislative assignment of the role of money to two metals at a certain historical stage came into conflict with the nature of money as the only commodity designed to play the role of a universal equivalent. Despite the legally established equality of both metals, only one of them served as a universal equivalent. As a result, one metal is valued according to the law higher than it market value, and the other below. This led to the displacement of coins made of metal, which was valued below market value, from circulation. Coins made of metal valued above market value become predominant in calculations. This phenomenon in the monetary system is described by the Copernicus-Gresham law - an economic law derived by the Polish scientist N. Copernicus in 1526 and finally formulated by the English financial figure T. Gresham in 1560, according to which “the worst money drives the best out of circulation” when they identical, established by the state nominal value. Under monometallism, the effect of the law

Copernicus-Gresham was manifested in the fact that full-fledged coins disappeared from circulation, giving way to coins of the same nominal value, but of lower quality.

Paper credit systems are monetary systems devoid of a metallic basis, built on the representative principle. Such monetary systems currently exist in almost all countries.

Patterns of functioning and development of metallic monetary systems

Monetary systems based on metal equivalents went through the following stages in their development:

bimetallism -> silver monometallism -> gold monometallism.

The introduction of the gold standard system (gold monometallism) was due to the formation and development of a single world market, since the strengthening of foreign economic relations required stability from the national currencies serving them. One of the direct prerequisites for states to implement the gold standard was the accumulation of gold reserves. Opportunities for this increased in the 50s of the 19th century. with the discovery of new deposits and especially in the 90s (Klondike, Yukon, South Africa). But the gold standard became an international monetary system when some countries accepted voluntary commitments to the unhindered movement of gold across borders, limiting the issue of national banknotes, and the free exchange of banknotes for gold. Thus, the gold standard had the features of the first international monetary system - the first in human history. By the end of the 19th century. from disparate national monetary systems, built on a gold coin basis, arose international system gold from the coin standard. This system required countries to implement it uniformly additional elements metal monetary systems based on the circulation of gold, such as:

• gold content of money - the weight content of gold, fixed by a given monetary unit, which is the scale for determining prices;
• gold (coin) parity - the ratio of currencies of different countries according to their official gold content;
• currency parity - the relationship between the currencies of different countries established by law. Used when the gold content of a given currency was not declared, but it was compared with other currencies that have a gold content.

Depending on the nature of the exchange of banknotes for gold, the following types of gold standard are distinguished: gold coin, gold bullion and gold exchange (gold and foreign exchange).

For gold coin standard characterized by the free purchase and sale of gold coins for credit notes (banknotes) at fixed rate, i.e. banknotes and gold coins circulate equally. The gold coin standard as the main form of organization of monetary circulation was established international agreements At the Paris Conference in 1867, gold was recognized as the only form of world money.

Rice. 2.2. Equilibrium in the gold coin standard system

The gold coin standard combined the features of the classical monometallic monetary system. This type of monetary standard existed until the First World War and was characterized as the most stable monetary system, which is explained by the following. From point of view commodity circulation it is important that the money in circulation represents a value equivalent to the value of the goods exchanged. But money doesn't have to have that kind of value. This is what makes it possible to mix gold with banknotes - signs of value. When the amount of goods costs changes total cost functioning gold money is adjusted by changing the amount of money in circulation. The cost of the monetary unit - the gold coin - remains unchanged, since it is determined by the cost of the corresponding weight of gold (Fig. 2.2). In this case, only the amount of money in circulation is elastic with respect to changes in the sum of commodity prices. This is the reason for the gradual abandonment of the circulation of gold coins.

The gold coin standard as a monetary system had absolute elasticity only in the event of a reduction in the volume of trade turnover in in monetary terms, when some of the gold coins settle in the form of treasure. But when trade turnover increases, the volume of additional issue of gold coins depends on the industrial production of gold and its entry into monetary circulation channels. When during periods of crisis there was a need for additional emission, the gold coin standard did not allow a rapid and arbitrary increase in the money supply. With the outbreak of World War I, the gold coin standard ceased to exist in most countries.

The abandonment of gold as the basis of the monetary system is happening gradually. During monetary reforms 1924-1929 return to the gold standard)" was made in two reduced forms - gold bullion and gold exchange standards. Gold displaced from retail circulation continues to be used in domestic and international wholesale trade, but in the form of bars - gold bullion standard. It is characterized by the exchange of banknotes for metal ingots, usually weighing 12.5-14 kg.

Installed in Austria, Germany, Denmark gold exchange standard(gold currency): banknotes are not exchanged for bullion; in order to get gold, one had to exchange the national monetary unit (banknote) for a certain amount of currency (motto) of the country where the gold exchange standard existed, and then exchange this currency for gold. Thus, the currencies of some states were made dependent on the currencies of other states.

Gold bullion and gold exchange standards were formalized by interstate agreements reached at the international economic conference in Genoa in 1922. This conference determined the status of the reserve currency (reserve currency).

Reserve currency - This is a currency that is used primarily for international payments or the formation of foreign exchange reserves. The country issuing the reserve currency is allowed to pay debts to other countries not with gold, but with its own currency. The pound sterling and the dollar were recognized as reserve currencies during this period. After the collapse of the British Empire (the British Commonwealth of Nations was formalized by Westminster status in 1931), the role of the reserve currency was assigned to the dollar. As a result of the global economic crisis 1929-1933 the gold standard was abolished in all countries. There was a refusal in domestic markets from all forms of payments in gold, and the relationship between the volume of gold reserves of banks and the size of money emission was lost.

In 1944, the charter of the International Monetary Fund was approved and a fixed price for gold was established—$35 per troy ounce (31.1 g). Thus it was installed gold dollar standard. The world has developed the so-called Bretton Woods monetary system, which was legally formalized in 1944 at the UN Monetary and Financial Conference in Bretton Woods (USA). The main features of this monetary system were as follows:

• gold functions as the embodiment of wealth and a means of international payments;
• the function of the means of payment is also assigned to the reserve currency - the US dollar:
• the reserve currency is redeemable for gold;
• the equalization of currencies and their mutual exchange were carried out on the basis of currency parities, expressed in gold and US dollars, officially agreed upon by the IMF member countries. Parities were stable;
• market exchange rates could deviate from fixed dollar parities by no more than 1%.

Due to the decline in gold reserves, the US government officially stopped selling gold bullion in dollars in 1971, and the gold dollar standard ceased to exist. Role reserve currencies The German mark, the Japanese yen, as well as collective monetary units - SDR and ECU - began to be used.

The last stage of the break between monetary systems and gold was the abolition of fixed gold parities of currencies and the transition to floating exchange rates. The Jamaican International Conference, whose agreements were introduced in 1976-1978, legally enshrined the demonetization of gold, which was expressed in the following:

• the official (fixed) price of gold was abolished;
• the gold content of countries' currencies was abolished;
• gold is excluded from settlements between the International Monetary Fund and its members.

In connection with the demonetization of gold, changes occurred in the structure of gold and foreign exchange reserves of states. The reserves of IMF member countries consist of four components:

1. Foreign currency - money of other countries belonging to a given country: deposits in foreign banks, investments in securities, circulating internationally stock market, debentures. A small part of this component is represented by cash currency.

2. The reserve position in the International Monetary Fund is the limit within which a country automatically receives from the fund the foreign currency necessary for settlements. The size of the limit corresponds to the amount of contributions of a given state to the capital of the fund in the form of gold and/or freely convertible currency (25% of the total contribution amount).

3. SDR (IMF unit of account), which a country has the right to use to purchase other currencies or for settlements with other IMF member countries.

4. The official state stock of gold has the role of a reserve, which can be sold and converted into money in the shortest possible time. Share of gold in state reserves decreased from 96% in 1938 to 20% in 1995.

Features of the functioning of paper-credit monetary systems

Paper-credit (fiduciary) monetary systems are monetary systems in which banknotes are not representatives of social material wealth.

Such monetary systems were formed as a result of the demonetization of gold. There are three types of fiduciary monetary systems:

• transitional (combine metal and paper circulation);
• full fiduciary standard;
• electronic-paper monetary systems.

Currently, most countries are transitioning to electronic-paper monetary systems. Characteristics such systems are as follows:

• issuing money is ok bank lending economic entities and for the increase in official gold and foreign exchange reserves;
• development of cashless money turnover and cash reduction;
• monopolization of the issue of cash by the state represented by the issuing bank;
• the prevailing development in the system of non-cash money circulation of electronic money payments:
  • based on multi-purpose prepaid cards (card-based systems) - based on cards with stored value, or “electronic wallets”;
  • based on “network money” (software-based / network-based systems) - the monetary value is stored in computer memory, and with the help of a special software its transfer is carried out via electronic communication networks (electronic payment systems of issuing banks, payments on the Internet);
• increasing role government regulation monetary circulation.

The functioning of modern monetary systems is based on a number of principles, which include:

• centralized management of the national monetary system;
• forecast planning of cash flow;
• stability and elasticity of money turnover;
• credit nature of money issue;
• the security of banknotes issued for circulation with the assets of the issuing bank;
• independence of the issuing bank from the government and its accountability to parliament;
• providing the government with funds only through lending;
• comprehensive use of monetary regulation instruments.

Based on these principles, elements of national monetary systems are formed. The supply of money in the economy is realized bank of issue countries that issue cash, and a system of commercial banks that “create” non-cash money. The size of the money supply depends on the main priorities of economic policy.

The elasticity of credit emission is achieved through the refinancing policy of commercial banks and other instruments monetary policy providing liquidity management for commercial banks. The structure of money supply is characterized by the predominance of non-cash money in in electronic format and is due to the following advantages of non-cash money:

• low costs of putting into circulation;
• high degree of control in the banking turnover system;
• high speed of calculations;
• saving costs of circulation by economic entities.

The volume of money supply in paper-credit monetary systems depends on the demand for money from the outside economic entities, which is due to the following main factors:

• "demand for transactions" those. money needed to implement economic activity enterprises and organizations (advance current assets, payment of wages), as well as for current consumption of the population (purchases in the system retail, in the service sector);
• level and dynamics of prices of all goods and services ( or the price component of money demand): prices are tied to an individual specific product, so the demand for money is mediated by the demand for the product (the above factor), but depends on the level and dynamics of prices. If prices rise for the same quantity of goods, the demand for money increases in accordance with the rise in prices;
• demand for financial assets, money is not only spent on current production and personal consumption, but also invested in financial assets - securities, bank deposits, bank certificates, insurance policies. The demand for financial assets is largely determined by interest rates of return on assets (the level of dividends on shares, the coupon rate on bonds, exchange rate differences in exchange rates, interest rates bank deposits). Yield rates directly affect price financial assets and thus regulate the demand for the assets themselves and the money needed for investment;
• interest rates in the credit market: because cashless money issue is mainly of a credit nature, the level interest rate does credit resources more or less accessible;
• velocity of money circulation: the higher it is, the less, other things being equal, the demand for money;
• investment demand for money associated with the expanded reproduction of the activities of economic entities (productive investment or real investment). The role of this component is especially relevant in the context of the emerging innovation economy when the main competitive advantages are formed on the basis of the active use of knowledge, information, and advanced technologies;
• intensity of application of modern banking technologies, which ultimately determine the speed of settlement and payment turnover;
• general level of tax burden. Despite the apparent isolation from the problems of money circulation, it, first of all, determines the boundaries of the shadow sector of the economy and the level of capital outflow from the country and thereby affects the speed of circulation of money, the outflow of cash from real circulation, and the formation of investment resources;
• intensity of money saving processes in the banking sector expands the possibilities of using money in non-cash circulation, since the increase in money is ensured by the fact that part of the previously issued money is in banking circulation.

Monetary systems based on the circulation of fiat paper money, currently exist in the vast majority of countries, due to their cost-effectiveness, convenience and elasticity. The principles of fiduciary monetary systems also apply to international and regional monetary systems.