exchange rate
Học thuậtThân thiện
Definition
- Noun:
- The value at which one currency can be exchanged for another: The "exchange rate" is the price of one nation's currency in terms of another currency. It determines how much foreign currency you can receive for a unit of your domestic currency.
Usage
- The "exchange rate" is a key economic indicator used in international finance and trade.
- It is typically expressed as a pair, e.g., USD/EUR = 0.92, meaning one US Dollar can be exchanged for 0.92 Euros.
- It is used when discussing travel, international business, investments, and economic policy.
Examples
- Noun:
- The current exchange rate between the US dollar and the Japanese yen is favorable for exporters.
- Before traveling, I always check the exchange rate to see how much local currency I will get.
- Fluctuations in the exchange rate can significantly impact a company's profits.
Advanced Usage
- "floating exchange rate": a rate determined by the foreign exchange market through supply and demand.
- Most major economies use a floating exchange rate system.
- "fixed exchange rate": a rate set and maintained by a government's central bank.
- The country pegged its currency to the dollar, establishing a fixed exchange rate.
- "real exchange rate": the rate adjusted for differences in price levels between countries.
- Economists analyze the real exchange rate to understand true purchasing power.
Variants and Related Words
- Foreign exchange (Forex/FX) (n): the market or system for trading international currencies.
- He works in the foreign exchange department of a bank.
- Currency conversion (n): the process of exchanging one currency for another.
- The bank charges a fee for currency conversion.
Synonyms
- Conversion rate: the ratio for converting one currency into another.
- Foreign exchange rate: another term for exchange rate, emphasizing the international context.
Related Phrases
- Exchange rate risk (n): the risk that changes in exchange rates will affect an investment's value.
- Companies use hedging strategies to manage exchange rate risk.
- Exchange rate mechanism (ERM) (n): a system used to manage a currency's exchange rate relative to other currencies.
- The European Exchange Rate Mechanism preceded the creation of the euro.
Noun
- the charge for exchanging currency of one country for currency of another