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17 What's the "Interbank" exchange rate?




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This article is from the Europe FAQ, by Yves Bellefeuille yan@storm.ca with help from Martin Rich M.G.Rich@city.ac.uk.

17 What's the "Interbank" exchange rate?

The "Interbank" rate is the rate banks charge each other when trading
large amounts. The rate you see listed in the newspapers is usually the
Interbank rate.

Unless you're changing very large amounts, the rate you'll get won't be
as favourable as the Interbank rate, but you can still use it to
determine whether the rate you're offered is reasonable. For
"electronic" transactions involving a bank machine card or credit card,
expect to pay about 1 % more than the Interbank rate. When changing
traveller's cheques or cash, you'll usually have to pay 2 % to 3 % over
the Interbank rate. Try to avoid paying any other fee or commission.

Many newspapers list foreign exchange or "Forex" rates. You can also
find them at http://www.oanda.com/ and
http://www.economist.com/markets/currency/extable.cfm.

 

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