Due to different in interest rate, AUD's rate is higher than EUR's rate.
Buying EUR/AUD, you need to pay interest for holding overnight.
Selling EUR/AUD, you are receiving interest for holding overnight.
In a logical sense, everyone should sell EUR/AUD for extra interest for holding overnight.
Does anyone know any market behavior on why EUR/AUD rises instead of falling down in market price? On the other words, people are willing to hold EUR/AUD by paying extra interest for holding them overnight.
Does anyone have any suggestions?
Thanks in advance for any suggestions
Why buys EUR/AUD to pay interest for holding them overnight?
It sounds like you may be talking about Forex rather than Futures Markets.
Buyers and sellers of EUR/AUD futures contracts don't pay or receive overnight interest. Check out the contract description and contract specifications at the exchanges where these futures contracts trade:
(link to EUR/AUD futures contract "EAD" at CME)
(link to EUR/AUD futures contract "KRA" at ICE)
Buyers and sellers of EUR/AUD futures contracts don't pay or receive overnight interest. Check out the contract description and contract specifications at the exchanges where these futures contracts trade:
(link to EUR/AUD futures contract "EAD" at CME)
(link to EUR/AUD futures contract "KRA" at ICE)