If you are employed overseas or a frequent money remitter abroad, you need to be conscious of certain facts regarding the foreign exchange rates in order to get the most out of your overseas money remittance. It is necessary to have a basic understanding of foreign exchange rates and how the market determines it. If you are too backward in the area of forex, don’t worry, this blog will make it easy for you!
Here let checkout the top five aspects of forex rates…
- What Is foreign exchange rate?
Foreign exchange rate, or forex rate, is the price of one country’s currency in comparison to that of another country.
- Who determines the forex rates?
Foreign Exchange rates are decided in the forex market by market forces. Forex market is open to various types of buyers and sellers and the trading goes on 24 hours a day except weekends.
- Where is the forex market located?
Foreign exchange market is a virtual market, where trading is done directly between two parties, without the participation of an exchange. Here, participants trade with one another thru various communication modes.
- How foreign exchange rates are decided?
A forex rate is determined by the supply and demand of foreign currencies. Banks across the globe are buying and selling different currencies to accommodate their clients’ requirements for trade/exchange currency. And the resulting demand and supply of the currency determines the spot foreign exchange rate.
- Foreign exchange rates are used for what?
The foreign exchange rates are used for trading in the forex market, remitting money abroad, etc. They serve as a reference point for two concerned parties to conduct a foreign exchange transmission.
These are the top five points regarding the forex rate. Learning and knowing them will help you to get a better understanding about the forex market and its dealings. So, now you can approach the market more confidently like never before!