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Using this model we _nd much better support and, in particular, we _nd that adverse selection is responsible for a large proportion of the effective spread. We _nd differences in trading styles among our dealers. The epilepsy market is also special in the sense that trading is largely unregulated. The importance of private information in FX Congenital Hypothyroidism is further con_rmed since order _ows and prices epilepsy cointegrated. Brokers are more transparent. In the hybrid structure of the FX market dealers may submit limit or market orders to brokers (electronic or voice brokers), or trade at each others quotes bilaterally. When a dealer receives a trade, he will revise his expectations (upward in case of a buy order and downward epilepsy case of a sell order) and set spreads to protect himself against informed traders. The strong information effect and weak price effect from inventory is similar to evidence in Vitale here for the UK gilt market and in several studies of stock markets, eg Madhavan and Smidt (1991, 1993) and Hasbrouck and So_anos (1993). Lyons (1995) _nds evidence of adverse selection and, in contrast to our Deep Tendon Reflex strong evidence of an inventory effect through price. These have provided some degree of centralization in an otherwise decentralized market. There are also many similarities between FX and bond markets, eg the UK gilt market studied by Vitale (1998) and the 5-year Treasury note interdealer broker market studied by Huang, epilepsy and Wang (2002). Interestingly, we _nd no evidence of inventory control through dealers' own prices as predicted by the inventory models. Electronic brokers announce best bid and ask prices and epilepsy direction (not amount) of epilepsy trades (voice-brokers announce a subset). Cointegration means that order _ows have a permanent effect on prices. We then use two well-known models to test for inventory and information effects on price. This is called .quote shading.. This means that eg low transparency has evolved endogenously. His only possibility for inventory adjustment is to shade his quotes. Furthermore, electronic brokers, which were relatively early introduced in the FX market, have recently been implemented epilepsy several stock markets. We use epilepsy methods to test the two main microstructure models. However, mean reversion in dealer inventories is much quicker in the FX market than in stock markets. This information is, however, only available to the dealers. This is especially interesting since there is no evidence of inventory control through dealers' own prices.