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FX Basics

Quote Currency

The quote currency, also called the counter currency, is the second currency in a currency pair. It represents how much of this currency is needed to buy one unit of the base currency. For example, in EUR/USD, the U.S. dollar is the quote currency, showing how many U.S. dollars are required to purchase one euro.

  • Simple Example: TechCorp is tracking the EUR/USD currency pair. The exchange rate of 1.1000 means that 1 euro (base currency) is worth 1.1000 U.S. dollars (quote currency).
  • Numerical Breakdown:
    • TechCorp wants to convert €100,000 into USD at a rate of 1.1000.
    • To calculate the amount in USD:
      • €100,000 × 1.1000 = 110,000 USD
    • This means €100,000 is worth 110,000 U.S. dollars at the current exchange rate.
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