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What is Exchange Rate? - Definition & Explanation

Definition

The price of one currency expressed in terms of another currency.

Exchange Rate Explained

An exchange rate is the price at which one currency can be exchanged for another. Exchange rates are determined by supply and demand, influenced by interest rates, economic data, political stability, and market sentiment.

Exchange Rate - Frequently Asked Questions

Interest rate differentials, economic data, central bank policy, political events, trade balances, and supply/demand dynamics.