The Global Currency Exchange Guide
Whether you are planning a holiday abroad, buying imported goods online, or trading forex, understanding exchange rates is crucial. Our currency converter provides up-to-date mid-market rates for major global currencies like the US Dollar (USD), Euro (EUR), and Japanese Yen (JPY).
What Determines Exchange Rates?
Currencies are traded 24/5 on the foreign exchange (Forex) market. Their value fluctuates based on supply and demand, driven by:
- Interest Rates: Higher interest rates offer lenders a higher return relative to other countries. Therefore, higher interest rates attract foreign capital and cause the exchange rate to rise.
- Inflation: Typically, a country with a consistently lower inflation rate exhibits a rising currency value, as its purchasing power increases relative to other currencies.
- Economic Stability: Investors seek stable countries with strong economic performance. Political turmoil can cause a currency to depreciate rapidly.
Mid-Market Rate vs. Tourist Rate
The rate you see on Google or our converter is the "Mid-Market Rate" (the midpoint between the buy and sell prices of two currencies). However, when you go to a bank or airport kiosk, you will get a "Tourist Rate."
Banks typically add a "spread" or margin of 2% to 5% on top of the mid-market rate. If the real rate is 1 USD = 0.90 EUR, the bank might only give you 0.85 EUR.
Major Currency Pairs
The most traded currency pairs in the world include:
- EUR/USD: The Euro and the US Dollar. The most liquid pair in the world.
- USD/JPY: The US Dollar and the Japanese Yen. Often reflects the Asian economic sentiment.
- GBP/USD: The British Pound and the US Dollar, often called "The Cable."
Frequently Asked Questions (FAQ)
How often are the rates updated?
Our rates are updated every hour to reflect the latest market movements. However, during weekends, the Forex market is closed, so rates remain static until Monday morning (Sydney time).
Why is the Buy price different from the Sell price?
This is called the "Spread." Currency providers buy currency at a lower price and sell it to you at a higher price to make a profit. The gap between these two numbers is their fee.
Disclaimer: The rates provided are for informational purposes only. We do not guarantee the accuracy of exchange rates for trading purposes.