Foreign Exchange: Practical Asset Pricing and Macroeconomic Theory Hardcover – 23 Feb. 2022

I have a research macro background , and bought the book after a recommendation from a friend.It’s a fantastic a mix of theory and practice!

Similarly to the previous book of the same author (Volatility, Iqbal 2018), Iqbal’s Foreign Exchange is no ordinary book. Indeed, the book delivers on its promise of providing the reader with the conceptual framework and the toolkit to consistently analyse and filter through the continuous information flow being streamed on a daily basis.The first chapter deep dives into risk premia in FX markets entrusting the reader with invaluable insights that are key to build the promised conceptual framework. The remaining chapters constantly expand on and apply those insights to major economics models, macroeconomic variables, financial instruments and asset pricing equations.The whole book is perfectly balanced between theory and practice, so much that the reader is able to easily understand even the most advanced concepts. I can’t hesitate to recommend the book to both university students and market professionals.

This book is a needed link between the academic theory of macroeconomics and asset pricing and the art of foreign exchange trading. In bridging the gap between the two, the book provides new insights on the genesis and nature of risk premia, the link between inflation, interest rates and spot returns, as well as the impact of fiscal and monetary policies. I would suggest this book to anybody, from students to expert market makers, looking to gain a deeper understanding of the FX market and how to interpret and monetise trading opportunities.

A really enjoyable read from beginning to end, with macroeconomic concepts explained so eloquently and formalised with just enough maths. Agree with other reviewers that it is rare to see such a fine balance between theory and practice.