Currency Converter

What are the global currency markets? Currency describes the money or official means of payment in a country or region. The best-known currencies include the U.S. dollar, euro, Japanese yen, British pound and Swiss franc. Currency symbols exist for most currencies, such as $, €, ¥ or £. The foreign exchange (FX) markets, however, use ISO (International Organization for Standardization) codes to identify currencies. Every day, trillions of dollars in currencies change hands in a highly professional interbank market, in which electronic trading platforms link currency traders from banks across the world. FX markets are effectively open 24 hours a day thanks to global cooperation among currency traders. At the end of each business day in Asia, traders pass their open currency positions to their colleagues in Europe, who – at the end of their business day – pass their open positions to U.S. traders, who then pass positions back to Asia at the end of their business day. And the cycle begins anew. This makes FX truly global and liquid. What determines exchange rates between currencies? The exchange rate gives the relative value of one currency against another currency. An exchange rate GBP/USD of two, for example, indicates that one pound will buy two U.S. dollars. The U.S. dollar is the most commonly used reference currency, which means other currencies are usually quoted against the U.S. dollar.