Do you want to know how foreign exchange rates are determined? If so, keep reading!
The foreign exchange market is very large, with trillions of dollars being exchanged on a daily basis. In order to have an idea about what happens in this market, it is important to understand how foreign exchange rates are determined and how they work.
The supply of currencies depends on several factors such as:
- How many units of a certain currency do we have?
- What does each unit cost?
- Who wants it?
- Will anyone sell it to me at this price?
- Is there a buyer willing to pay more than I want for it?
- What would happen if I bought more units than there were buyers willing to sell them at this price?
Overall, foreign exchange rates are determined by the supply and demand of global currency pairs. When the demand for one currency is greater than another, its value rises. The opposite is also true, meaning that if there is more demand for a different currency than another, then its value will fall.
Use an API to obtain foreign exchange rates
So, to make sure you don’t miss out on any opportunities or risks, you need access to real-time and historical data about foreign exchange (forex) rates. A forex API provides you with this data so that you can always be up-to-date with what’s happening in this important market. However, at this point in time, there are many APIs available online; but only a few of them can be trusted as reliable sources of data. Lucky for you, we will recommend you the best one so far!
Use Exchangr API
Exchangr is a real-time JSON API that provides currency conversions as well as foreign exchange rates. Its currency data is particularly trustworthy since it collects data from a variety of financial providers, including financial institutions from all around the world. Hence, Exchangr API provides the most up-to-date and accurate rates for a total of 172 global currencies. This means more than 30.000 currency pairings!
Besides, Exchangr API knows that the foreing exchange rates are updated every minute within the world market; so it offers regular updates ranging form 60 minutes to 60 seconds. This means that you can get real time data through this API. Also, one of the main things Exchangr provides is a historical data source so that you can see what has happened at any point in time.
What do I have to do to use Exchangr API?
First and foremost, register here. Creating an account is for free and no credit card information is required! After that, you will be given an API key right away. This unique combination of letters and numbers will grant you access to Exchangr’s endpoints. Once you have it, you are ready to make requests. Select the currencies for which you wish to get rates or convert; and execute the API request. To do so, you can follow the instructions provided by Exchangr’s Documentation (read them here).
And that’s all, in a matter of seconds you’ll obtain the foreign exchange information you needed!
So, now that you know more about the foreign exchange world, start benefiting from it with Exchangr API!
Related post: Can I Improve My Finances With A Forex Api?
Also published on Medium.