Cross rates: Difference between revisions
From ACT Wiki
Jump to navigationJump to search
imported>Doug Williamson m (Added 1 line space before see also) |
imported>Doug Williamson (Reference minor currencies expressly.) |
||
| Line 5: | Line 5: | ||
For example USD/EUR, USD/JPY. | For example USD/EUR, USD/JPY. | ||
The related cross rates are the foreign exchange rates between the other related currency pairs, calculated via the USD rates. | The related cross rates are the foreign exchange rates between the other related currency pairs of more minor currencies, calculated via the USD rates. | ||
For example the EUR/JPY rate, as calculated via the USD from the USD/EUR and USD/JPY quotes. | For example the EUR/JPY rate, as calculated via the USD from the USD/EUR and USD/JPY quotes. | ||
| Line 16: | Line 16: | ||
* [[Foreign exchange rate]] | * [[Foreign exchange rate]] | ||
[[Category:Manage_risks]] | |||
[[Category:Trade_finance]] | [[Category:Trade_finance]] | ||
Revision as of 17:08, 18 April 2015
Foreign exchange.
Most foreign exchange rates are quoted against a widely traded currency, most commonly USD.
For example USD/EUR, USD/JPY.
The related cross rates are the foreign exchange rates between the other related currency pairs of more minor currencies, calculated via the USD rates.
For example the EUR/JPY rate, as calculated via the USD from the USD/EUR and USD/JPY quotes.
Cross rate bid-offer spreads are normally wider than the bid offer spreads quoted against USD because they incorporate two bid-offer spreads against the USD, not just one.
