In the table below you can see live Forex rates for the forex market.
The forex rate indicates how much a particular country's currency is worth against that of another. For example, with an exchange rate of 1.13 for the EUR/USD pair, you need 1.13$ to buy 1€. In this example, USD represents the US Dollar and EUR represents Euro.
The data of the Live Forex Rate comes from the interbank market where large financial institutions are the liquidity providers. The interbank market has a high level of liquidity which explains the competitive prices and spreads. Traders can use this data to compare the prices of forex brokers.
The Forex rate shows you the value of your country's money against that of another. This process can happen for a number of reasons, e.g. for traveling purposes, but here we are concerned with the Foreign Exchange Market (Forex) where traders trade against each other using different currencies. Moreover, the trades that these traders engage in will have a great impact on the value of the exchange rates.
The currencies that US traders choose to trade, namely the US Dollar, Euro, Pound, Peso, and Yen will have a direct effect on the value of forex rates. The major players in the market, such as central banks and governments can influence the exchange rates in the long run. These exchange rates are affected very easily by several variables, and therefore, can fluctuate rapidly.
The currency that you own, no matter the type, can go up or down in value, and thereby, increase or decrease your purchasing power. Countries that have large reserves of foreign currencies can control the value of their currencies to some extent (such as the Saudi riyal and the Chinese yuan). In addition, these exchange rates are usually based on the US dollar.
Three determining factors can influence the exchange rate, namely the interest rate, the money supply, and the economic condition (inflation).
Investors are interested in currencies with the highest interest rate because it’s less work and the returns are substantially higher. The supply of money can have a positive or negative effect on the exchange rate. Imagine that the central bank of your country decides to print an absurd amount of money with no reserve to support it, well this decision will cause the inflation rate to rise, as a result of which the value of your currency goes down.
When a country's economy is growing, the value of its currency follows a similar pattern. That is why only in a developed country you can purchase goods and services by paying the highest value. Conversely, if a country’s economy is collapsing, the value of its currency will go down with it. Currencies that lose their value are interesting to the investors of the market.
Finally, it’s all about supply and demand, the more a currency is demanded, the higher its value. Currencies have a direct relationship with each other in terms of value. Another important factor is the direct relationship between inflation and interest rates. These two factors go hand in hand in the sense that higher interest rates lead to lower inflation and vice versa.
