foreign exchange

Foreign exchange, or forex, is the global marketplace where currencies are traded. When countries or businesses need to buy or sell foreign currencies—such as a tourist exchanging dollars for euros—these transactions occur in the forex market. Exchange rates fluctuate based on factors like economic conditions, interest rates, and geopolitical stability. This market operates 24/7 worldwide, enabling international trade and investment by providing a mechanism to convert one currency into another efficiently. Essentially, foreign exchange facilitates global financial interactions, allowing individuals and organizations to manage currency needs and hedge against risk.