Okuzeka
Finance & Banking vocabulary · Interest & Exchange Rates

Foreign exchange

Meaning in finance & banking, with examples

nounCore term

In finance & banking, foreign exchange means: The buying and selling of currencies, or foreign currency itself. It is often shortened to FX or forex.

In Turkish: döviz, kambiyo

How it is used

Used in treasury, trade finance and branches. Banks have an FX desk; companies buy foreign exchange to pay suppliers and hedge foreign exchange risk. 'FX rate' means exchange rate.

Example sentences

  1. Our foreign exchange desk can quote you a rate for the euro payment.

  2. Foreign exchange losses hit the company's profit this quarter.

Common collocations

  • foreign exchange market
  • foreign exchange risk
  • FX desk
  • foreign exchange reserves
  • exchange rateThe price of one currency in terms of another, for example how many Turkish lira you need to buy one euro.
  • hedgeTo reduce the risk of losing money from changes in prices, interest rates or exchange rates, usually by taking an opposite position with derivatives.
  • market riskThe risk of losses caused by changes in market prices, such as interest rates, exchange rates, share prices and commodity prices.
  • wire transferAn electronic transfer of money from one bank account to another, often between different banks or countries.

More terms: Interest & Exchange Rates

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This page explains English vocabulary for learners. It is not financial advice.