Before you get to know and learn something about fixed vs. floating exchange rate, first you need to know what is actually an Exchange Rate? The rate at which one currency is exchanged for the other is known as exchange rate. Simply defining, exchange rate is the value of another country’s currency compared to that of your own country’s currency. This is where the world’s various currencies are priced by speculators, traders, banks and investment funds. As for example, on a given day, one may trade one U.S. dollar for a certain number of British pounds. A currency’s exchange rates may be floating i.e. they may change from day to day or they may be pegged to another currency. (more…)

An exchange rate is the price at which one country’s currency trades for another on the foreign exchange market. There are 2 extreme regimes of exchange rates – flexible exchange rate and fixed foreign exchange rate. It is important that you know such when you are in to online forex trading. (more…)