Currency Exchange Rate

A currency exchange rate is the value at which one country's currency can be exchanged for another. It reflects the relative worth of two currencies based on supply and demand in the global marketplace. For example, if the exchange rate between the US dollar and the euro is 1 USD to 0.85 EUR, it means one dollar can be exchanged for 85 cents in euros. These rates fluctuate constantly due to factors like economic conditions, interest rates, inflation, and political stability. Understanding exchange rates helps in international trade, travel, and investing decisions.