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Two questions: 1. What/Where is this market? What’s the forex equivalent of NYSE or NASDAQ 2. Even If both the banks hold the other country’s currency, (which
by mikymoothrowa 4y ago
Two questions:
1. What/Where is this market? What’s the forex equivalent of NYSE or NASDAQ
2. Even If both the banks hold the other country’s currency, (which in most cases they won’t), how do they know what the exchange rate is.
- dkjaudyeqooe 4y agoFX is a shared or "distributed" market between the institutions that trade, such as big international banks and other market participants. They would use a shared electronic market (reporting) to determine the price. It's not exchange (as in NYSE) based. The exchange rate is set by what the market participants are willing to trade at. Banks can hold numerous currencies by having banking licences in the respective countries. See here for more details: https://en.wikipedia.org/wiki/Foreign_exchange_market https://en.wikipedia.org/wiki/Foreign_exchange_market