Currency Converter | Foreign Exchange Rates | Wise (2025)

FAQs

How do you solve for foreign exchange rate? ›

Calculate an FX rate using this simple formula: Your starting figure (in your local currency) divided by the final number (in the new foreign currency) = the exchange rate.

Local banks and credit unions usually offer the best rates. Major banks, such as Chase or Bank of America, often offer the added benefit of having ATMs overseas. Online peer-to-peer foreign currency exchanges. Online bureaus or currency converters, such as Travelex, provide convenient foreign exchange services.

To convert from a base currency, you would multiply by the exchange rate. If the exchange rate is greater than 1, you will get a larger number—that is, you will get more of the second currency in exchange for the first.

Divide your current (home) currency by the exchange rate. For example, suppose that the USD/EUR exchange rate is 0.631 and you'd like to convert 100 USD into EUR. To do this, simply multiply the 100 by 0.631 and the result is the number of EUR that you'll receive: 63.10 EUR.

If "a" is the money you have in one currency and "b" is the exchange rate, then "c" is how much money you'll have after the exchange. So a * b = c, and a = c/b. For instance, say you want to convert Euros to US dollars.

Conversion rate = total number of conversions / total number of visitors * 100.

In a floating regime, exchange rates are generally determined by the market forces of supply and demand for foreign exchange. For many years, floating exchange rates have been the regime used by the world's major currencies – that is, the US dollar, the euro area's euro, the Japanese yen and the UK pound sterling.

What is the real exchange rate formula? ›

The core equation is RER = eP*/P, where, in our example, e is the nominal dollar/euro exchange rate, P* is the average price of a good in the euro area, and P is the average price of the good in the United States.

The exchange rate gives the relative value of one currency against another currency. An exchange rate GBP/USD of two, for example, indicates that one pound will buy two U.S. dollars.

If you don't know the exchange rate, you can use this formula: starting amount (base currency) / ending amount (foreign currency) = exchange rate. Use the currency conversion formulas mentioned earlier to calculate how much you'd get for your currency if you were trading in the forex market.

The conversion rate is calculated by dividing the number of conversions by the total number of visitors. For example, if an eCommerce business received 1,000 site visitors in one month and received 50 customer orders, then the conversion would be 5.0% for the month.

Easy mistakes to make

It is easy to confuse whether you need to multiply or divide by the exchange rate. One way to remember is with the rule: If you are going from the “1” to the other currency then multiply. If you are going to the “1” from the other currency then divide.

In a floating regime, exchange rates are generally determined by the market forces of supply and demand for foreign exchange. For many years, floating exchange rates have been the regime used by the world's major currencies – that is, the US dollar, the euro area's euro, the Japanese yen and the UK pound sterling.

Suppose 1 USD = 83.12 INR. Now, if you want to exchange USD/INR, calculate the currency exchange by dividing the current currency by the exchange rate. If you want to convert 100 USD into INR, simply multiply 100 by the exchange rate (83.3). The result would be 8,312 INR.

WHAT IS THE REAL EXCHANGE RATE? The real exchange rate (RER) between two currencies is the nominal exchange rate (e) multiplied by the ratio of prices between the two countries, P/P*.