Okuzeka
International Trade vocabulary · Foreign Exchange

Spot rate

Meaning in international trade, with examples

nounCommon term

In international trade, spot rate means: The exchange rate for buying or selling a currency for immediate delivery, which for most currencies means settlement within two business days.

In Turkish: spot kur, anlık kur

How it is used

The rate you see on screens and in the news. Banks quote a buying (bid) and a selling (ask) spot rate, and forward rates are calculated from it. In trade emails people may say 'today's rate' or 'the market rate' for the same thing.

Example sentences

  1. We converted the payment at the spot rate on the day it arrived.

  2. The forward rate was slightly higher than the spot rate.

Common collocations

  • current spot rate
  • at the spot rate
  • spot rate and forward rate
  • EUR/USD spot rate
  • exchange rateThe price of one currency expressed in another, for example how many Turkish lira you need to buy one euro.
  • forward contractAn agreement with a bank to buy or sell a set amount of foreign currency on a future date at an exchange rate fixed today.
  • hedgeTo reduce the risk of losing money from future price or exchange-rate changes, for example by fixing today the rate for a payment that will arrive later.
  • foreign currencyMoney in the currency of another country, such as US dollars or euros for a company based in Turkey.

More terms: Foreign Exchange

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