Exchange rate refers to the exchange rate between two currencies, which is the price expressed by one monetary unit in another monetary unit. According to different expressions, exchange rate can be divided into direct exchange rate and indirect exchange rate. Direct exchange rate refers to the amount of a certain number of other monetary units converted into domestic currency, and indirect exchange rate refers to the amount of a certain number of domestic currencies converted into other currencies. Usually, the RMB exchange rate is expressed by direct exchange rate, and the exchange rate in the bank is expressed in three ways: buying price, selling price and middle price. The bid price refers to the price at which banks buy other currencies, and the selling price refers to the price at which banks sell other currencies. The median price is the average price of the bank's buying price and selling price, and the bank's selling price is generally higher than the buying price to obtain the difference.

Both the buying price and the selling price are the settlement price for immediate delivery, that is, the spot exchange rate, which is relative to the forward exchange rate, and the forward exchange rate is the settlement price for delivery on a future date. Spot exchange rate generally refers to the central parity of RMB exchange rate announced by the People's Bank of China on that day. When an enterprise has a simple currency exchange transaction or a transaction involving currency exchange, only the middle price cannot reflect the profit and loss of the currency transaction, and it needs to be converted by the buying price or selling price.

The People's Bank of China only announces the central parity of RMB against USD, EUR, JPY and HKD in the inter-bank foreign exchange market every day. If the foreign currency transaction of an enterprise only involves the conversion between RMB and these four currencies, the published central parity of RMB exchange rate can be directly used as the spot exchange rate for conversion; Enterprises' foreign currency transactions involve the conversion between RMB and other currencies, and should adopt the arbitrage method to convert US dollars according to the conversion rates of various currencies announced by the State Administration of Foreign Exchange; Where an enterprise's foreign currency transaction involves the conversion of currencies other than RMB, it may adopt the conversion rate of direct conversion of various currencies into US dollars announced by the State Administration of Foreign Exchange.