The institutions or organizational processes which facilitiate the exchange of monetary assets are known as monetary market.
Monetary market can be divided as money market and Capital market.
Liquidity of credit instruments and maturity period are used to distinguish between money market and capital market.
Money market is the market in which transaction of money and shortterm monetary instruments are exchanged.
The main function of the money market is to co-ordinate borrowers and suppliers of short term credits.
The bills and securities with a maturity period of less than one year are called short term monetary instruments.
The instruments which are used in the money market are called credits, treasury bills, securities, domestic and foreign bills of exchange and repurchasing agreements of commercial papers.
The sub markets of the money market are as follows:
