In finance, the exchange rates (also known as the foreign-exchange rate, forex rate or FX rate) between two currencies specifies how much one currency is worth in terms of the other. It is the value of a foreign nation’s currency in terms of the home nation’s currency.[1] For example an exchange rate of 95 Japanese yen (JPY, ¥) to the United States dollar (USD, $) means that JPY 95 is worth the same as USD 1. The foreign exchange market is one of the largest markets in the world. By some estimates, about 3.2 trillion USD worth of currency changes hands every day.
The spot exchange rate refers to the current exchange rate. The forward exchange rate refers to an exchange rate that is quoted and traded today but for delivery and payment on a specific future date.
Contents[hide]
1 Quotations
2 Free or pegged
3 Nominal and real exchange rates
4 Bilateral vs. effective exchange rate
5 Uncovered interest rate parity
6 Balance of payments model
7 Asset market model
8 Fluctuations in exchange rates
9 See also
10 External links
11 References
Subscribe to:
Post Comments (Atom)
No comments:
Post a Comment