The rate you see here is not the rate you will get
This page shows the mid-market rate — the midpoint between what buyers are bidding and what sellers are asking on the global market. It is the honest, unmarked-up number, and it is the rate you will see quoted on the news or on a search engine.
It is almost never the rate you actually receive. Banks, card networks and exchange bureaus apply a spread: they hand you a slightly worse rate and keep the difference. That margin is frequently the entire cost of the transaction, and it is invisible precisely because there is no line item for it.
How to spot the markup. Take the rate you were offered, divide it by the mid-market rate above, and subtract one. If your bank offers 0.92 when the mid-market is 0.95, that is a 3.2% fee — on 2,000 units of currency, 64 that never appeared on any receipt. A "zero commission" exchange desk makes all of its money this way.
What actually moves a currency
- Interest rates. The biggest single driver. Money flows toward higher yields, so when a central bank raises rates, its currency usually strengthens.
- Inflation. A currency losing purchasing power at home tends to lose it abroad too. See the inflation calculator for what that does over a decade.
- Trade balance. A country that exports more than it imports has more foreign buyers needing its currency.
- Confidence. Political stability, debt levels and plain sentiment. In a crisis, money runs to the dollar, the franc and the yen regardless of the underlying arithmetic.
Short-term moves are dominated by the last one, which is why nobody can reliably forecast next month's rate — and why you should be sceptical of anyone who says they can.
Getting a better rate in practice
- Always pay in the local currency. When a foreign card terminal offers to charge you in your home currency, that is dynamic currency conversion and the rate is consistently poor. Decline it.
- Avoid airport and hotel exchange desks. The convenience is real and so is the 5–12% spread.
- Compare the total, not the fee. A transfer service advertising a flat fee with a bad rate can cost more than one charging a visible percentage at the mid-market rate.
- Withdraw larger amounts less often if your card charges a fixed fee per ATM withdrawal — but check the foreign transaction percentage too.
A note on the numbers here
Rates update once a day on the free feed this page uses, which is entirely adequate for planning a trip, checking a salary offer or valuing savings held abroad. It is not suitable for trading, where seconds matter and the spread is the whole game. Nothing on this page is a quote or an offer to exchange anything.