1, the concept of exchange rate Foreign exchange rate is the rate, parity or price at which one country's currency is converted into another country's currency; It can also be said that it is a foreign currency price expressed in domestic currency. Because of international trade and non-trade exchanges, countries need to handle international settlement, so a country's currency has an exchange rate against other countries' currencies, but the most important thing is the exchange rate against a few countries' currencies such as the US dollar.

2. Exchange rate pricing method

The pricing methods of exchange rate are divided into direct quotation method and indirect pricing method.

(1), direct quotation: refers to the pricing method of converting a certain number of specific foreign exchange currencies into a relative number of other currencies. The number of specific foreign currencies in the direct quotation remains unchanged, and other currencies change accordingly. For example, USD/CHF, that is, USD unit is 1.

(2) Indirect pricing method: refers to the pricing method of converting a certain amount of other currencies into specific foreign currencies. In the indirect pricing method, the quantity of other currencies remains unchanged, while the quantity of specific foreign currencies changes accordingly. For example, Euro/USD, that is, the unit of Euro is 1.

There is no essential difference between direct quotation method and indirect pricing method, but the pricing form is opposite.