A currency converter is specifically software program which is designed to rapidly convert one currency to another in order to verify its corresponding value against the other currency. The converter is usually part of an online website or it comes as part of an iPhone or a smart phone app and it relies on the current exchange rate or real-time market data. It uses the same technique as the barometer in measuring the change in value of any currency. In case of any discrepancy, it simply recalculates the conversion process until it finds the right value.
There are a number of currency converters available online and they work in different ways. Some of them provide the option of only displaying the currencies you want to compare. You can enter the name of the currency you want to compare and it will instantly show the list of currencies. Others have more advanced options for customizing their service. They allow for custom selection of currencies to be compared, and some also allow input of multiple currency pairs.
When you use a currency converter, you can immediately identify the difference between two currencies. This can be crucial in international business transactions and other such activities which require you to deal with currencies from various countries. For instance, if you are planning to travel to Europe and you need to convert your home currency to Euro, you should be able to get the amount in US Dollars. If you are going to purchase something or avail any services in that European country, you should be able to convert the amount in Euro at the time of payment.
The Forex market rate is the base rate translated into other currencies. Most of the currency converter services take this into consideration and give the conversion rates at the time of the request. Some of the factors which influence the exchange rate are political situations like elections, economic conditions and financial reports.
The other factor which influences the exchange rate is the supply and demand in the market. The Forex market is quite dynamic, so there is constant movement in prices. You will not be able to determine the real value of two currencies overnight. You have to wait for some time till the value increases or decreases. The currency converter helps you convert currencies immediately and thus saves you from suffering from loss due to delay.
The United States dollar and the Euro are the two currencies in which the Forex market largely functions. The European Commission and the Bank of the United States are the central banks which influence the exchange rate between the two currencies. The other factors that affect the exchange rate are the policies of the government of the country, the economics of the country etc. Some of the major economic indicators, which are used by the currency converter are Consumer Price Index (CPI), Purchasing Managers Index (PMI) and Producer Price Index (PPI).
If you want to send money to a person in another part of the world, you need to know the currency converter of that country. To receive payments from people in other countries, you should use the international money transfers fees to calculate the exchange rates. You can use the information on the web to know about the exchange rates and the names of the currency converters in foreign countries. For sending payments to friends in the United States, you can use the name of the bank or credit union. Using the name of the financial institutions in other parts of the world will help you in getting the right exchange rate.
The website of the FX brokers and FX market gurus also provides an international currency converter. You can bookmark the site of your choice and frequently check it for updates. If you know the name of the currency converters in other parts of the world, you can book them online for receiving the most accurate information at minimal cost and in the shortest period of time.