Currency converters are popular tools to calculate the exchange rate of currencies. Trading takes place on the forex market every day, 24 x 7, and the currency exchange rates are constantly changing.
Live currency rates provide updated currency rates to help every investor, trader, tourist, and entrepreneur in their transaction.
Currency Converter: What is it?
When you require foreign currency, determine the amount needed for conversion.
Currencies are exchanged in pairs and one currency is quoted against another currency. To exchange 1000 US Dollars into EUR, you have to check the exchange rate EUR/USD, with a value of 1.14. When we divide 1000 USD by an exchange rate of 1.14, we get 844 Euros.
The first currency represents one unit. The second currency is one we purchase with one unit of the first currency. If the GBP/USD currency pair is 1.35, it means that it costs 1.35 US Dollars for 1 British Pound.
Foreign exchange currency US Dollar forms almost 88% of global trade, and most exchange rates are compared to the USD.
Currency Converter Users
The forex exchange currency rates keep changing as they depend on the interest rates, inflation, and economic health of a country.
Those involved in import and export businesses, sending money abroad, paying for students studying abroad, and traveling to other countries use currency converters.
- Traders: International markets buy and sell currencies through foreign exchange currency trading. As the forex is the largest global market, users prefer to have a currency exchange calculator to get live updates on the currency pair prices.
- Entrepreneurs: Businessmen dealing in exports and imports keep in touch with our currency converter to keep track of the purchase and sales amount and the profit made. You can find live currency rates on currencies, cryptocurrencies, indices, and commodities to enable consistent trading.
- Travel: For international travel purposes, you need the local currency of the country you are traveling to. Forex traders need to know the exact exchange rate when changing currencies of different countries. Keep track of your travel expenses when traveling to other countries.
- Paying for Students Studying Abroad: Students studying in other countries require the local currency. They need it to pay fees, meet everyday expenses, and travel purposes. Even for small transactions, you require the local currency while studying abroad.
The currency converter calculator is handy for people dealing with foreign currencies. You can subscribe for email updates to receive live currency rates.
Foreign Exchange Currency Converter Calculation
A simple formula to calculate the exchange rate is
Original Currency (Starting Amount) / New Currency (Ending Amount) = Exchange Rate.
Currency converters calculate the currencies in pairs. The exchange rate of one US Dollar in terms of the Canadian Dollar is USD/CAD, with a value of 1.26.
To buy the British Pound currency by using the US Dollar, calculate the exchange rate as GBP/USD
The EUR/USD, the GBP/USD, the USD/CHF, USD/AUD, and the USD/NZD are some currency pairs that are most traded on the foreign exchange currency.
The currency exchange calculator app helps in money transfer on the international market to make payments in cash or through bank accounts.
When you need a foreign currency, determine how much of the currency you require. If you want to convert 1,000 US dollars to GBP, you can make the calculation easily.
But when you get the currency at a bank or an exchange, they charge you more for converting your currency into another currency. This price difference is called the markup value, and it is the compensation for the service done.
Need for Currency Converter Calculator
Currency exchanges play a vital role in international trade, travel, and tourism.
- If you are traveling to Egypt from the United Kingdom, you need the Egyptian Pound to travel in Egypt. You cannot use the British Pound.
- If a person living in the United States wants to purchase cars from France, he must pay in the Euro currency.
- To send money from the United States to India, you have to send Indian Rupees.
There are more than 4 trillion dollars changing hands in the financial markets on a daily basis. If you are looking for a particular currency conversion rate, use the search function.
- The currency converter app is accessible on all your devices.
- Live exchange rates convert multiple currencies easily.
- Customize your currency list to view the currencies that you constantly review.
- You can also customize your currency list, making it easier to view the currencies you prefer.
- You can use the app in offline mode.
- Access live currency rates from your mobile devices using our application.
Using The Currency Exchange Calculator
The currency exchange calculator is very simple and easy to use.
- Enter your home currency: To calculate the exchange rate for any two currencies, enter the value of the currency to be converted.
- Determine fee rate: Use your debit or credit card charges calculator and determine the fee. Most credit cards charge a 2% fee.
- Calculate the foreign exchange fee: Click on the foreign exchange charges calculator icon. Enter your transaction details and the date of the receipts.
When you buy a currency pair, the bank will charge a markup value, which is their profit. Keeps a constant check on the currency exchange calculator to prevent being duped by exorbitant fee.
Currency Exchanges: History
The US Dollar is the most used reference currency. Most currencies are quoted against the US Dollar.
In the nineteenth century, gold reserves backed the currencies of a country. Towards the end of the 1920s, local currencies started using the US Dollar and the British Pound as reserve currencies. Currently, countries follow the free-floating currency system, but a few countries like China follow a fixed exchange rate.
The forex markets started to influence the currency rates as international trade bloomed. Importers and exporters were the major players of the forex markets. Slowly financial institutions, hedge funds, insurance companies, asset managers, and central banks joined in.
Factors that Determine the Currency Exchange Rates
Currency rates in the forex markets are determined by the demand and supply for currencies, the central bank actions, and government intervention. The exchange rate is the relative value of a currency against the value of another currency.
When the economy of a country strengthens, its currency value increases. Factors like inflation and central bank policy rates affect currency value.
When the demand for a currency decreases, its value decreases. Imports become expensive, and consumers depend on local goods. The market corrects automatically. Local production improves, which in turn generates more job opportunities. Exchange rates keep changing, and users utilize currency converter calculators to keep up with the changing currency rates.
As a traveller, you require a rough idea of the money required to meet expenses. But as a currency trader, every small movement in the currency, till the last digit, plays an important role in profits called the pip. Currency rate conversions are possible through manual calculation though it may lead to big mistakes and errors.
Fee on Currency Conversion
A fee is charged on currency conversion on
- Debit/Credit/Prepaid cards
- Traveller checks
- Cash advance
- Airport and hotel exchange desks.
Currency Calculator Tools
There are online currency calculator tools available for easy and simple calculation. The tool allows users to calculate the currency conversions between two currencies. It uses live market rates.
Click the “Calculators” icon on the Tools Menu to get the trading calculators.
Advantages of Currency Exchange Converters
The foreign exchange currency converters deal in multiple currencies, individual investors, financial institutions, and brokers.
- Users can trade in currency pairs across the globe.
- Currency conversion rates operate round the clock.
- Choose money transfer services that are transparent and secure.
- Choose services that offer low transfer fees.
Drawbacks of Currency Exchange Converters
Currency conversion exchanges charge an exorbitant fee, which is higher than the usual rate. While using a new currency, travelers should update themselves on currency exchange options, as hidden fees may bring up costs.
You can know about the currency exchange rating by reading reviews from previous users to prevent you from fraudulent services. Some foreign currency exchanges at airports and hotels charge “no fee”, but they offer a high rate, and users have to pay more for currency conversion.
Make sure that you choose currency transfer services that are reliable and transparent. Get live currency rate updates to ensure that you don’t get duped. Learn to use the currency converter calculator.
Check the Safety of the Currency Exchange Calculator
Ensure that the currency exchange calculator is reliable.
- To know if the currency exchange calculator app is safe, you can review the ratings and go through comments left by users. It will give you an idea of the security and reliability of the app.
- You can go through the currency exchange calculator developer’s updates. If it is not regularly updated, it suggests that the app may have security issues or does not support new devices.
- Choose an official store such as Google Play or Apple App Store.
Foreign exchange currency markets are open 24 hours a day, as global transactions take place constantly. Countries are located across different time zones, and transactions are made at varying time frames.
Use the best currency calculator app to stay updated on the forex market.
