A foreign exchange market is a market where a convertible currency is exchanged for another convertible currency or other convertible currencies. In the transaction or execution of conversion, one currency is considered domestic and the other is regarded as foreign, from a certain geographical or sovereign point of view, so is the term foreign exchange derived. Foreign exchange markets are not reserved for traders or finance professionals only but for almost everyone, from multinational corporations operating in several countries to tourists travelling across two currency zones. As long as national states or blocs of national states that adopt their own currencies exist, foreign exchange markets will persist to serve business, nonbusiness, and sometimes, political needs of business firms, governments, individuals, and international organizations and institutions.
Keywords
- Exchange Rate
- Foreign Exchange
- Foreign Exchange Market
- Arbitrage Opportunity
- Real Effective Exchange Rate
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.
Access this chapter
Tax calculation will be finalised at checkout
Purchases are for personal use only
Preview
Unable to display preview. Download preview PDF.
Author information
Authors and Affiliations
Corresponding author
Rights and permissions
Copyright information
© 2009 Springer-Verlag Berlin Heidelberg
About this chapter
Cite this chapter
Wang, P. (2009). Foreign Exchange Markets and Foreign Exchange Rates. In: The Economics of Foreign Exchange and Global Finance. Springer, Berlin, Heidelberg. https://doi.org/10.1007/978-3-642-00100-0_1
Download citation
DOI: https://doi.org/10.1007/978-3-642-00100-0_1
Published:
Publisher Name: Springer, Berlin, Heidelberg
Print ISBN: 978-3-642-00106-2
Online ISBN: 978-3-642-00100-0
eBook Packages: Business and EconomicsEconomics and Finance (R0)