Most prices are set by someone. A shop decides what a loaf costs; a regulator approves what electricity costs. An exchange rate is set by nobody, and the absence of a setter is the thing that explains almost everything else about how it behaves.
There is no exchange
Shares have a venue. If you want the price of a listed company you look at the exchange it trades on, and there is one answer.
Currencies do not work this way. The foreign exchange market is over the counter: a network of banks and electronic platforms dealing with each other directly, around the clock, with no central book and no closing price. Trading rolls from Sydney into Tokyo, through London — still by far the largest centre — into New York, and back round.
The consequence is immediate: **there is no such thing as the price of EUR/USD at a given second.** There are many prices, quoted by many institutions, differing in the fourth or fifth decimal. They stay close to each other because anyone quoting badly out of line gets traded against instantly, but they are not identical, and there is no authority whose number is the true one.
Who is actually trading
Very little of the volume is people changing money for a trip. The overwhelming share of turnover — measured every three years by the Bank for International Settlements, and running to trillions of dollars a day — comes from:
- Banks dealing with each other. The core of the market.
- Companies. A German manufacturer paid in dollars, a British importer buying in euros. Real trade flows, but smaller than most people assume.
- Investors. Pension funds buying foreign bonds, funds hedging their currency exposure, speculative traders. This is where the bulk of the volume is.
- Central banks, occasionally, and usually deliberately visibly.
Those participants are not trying to establish a fair value. They are each solving their own problem, and the price is the residue of all of them acting at once.
Bid, ask and where a rate lives
Every quote has two sides. A dealer says: I will buy at this level, I will sell at that one. The buying price is always the lower of the two, and the gap between them is the dealer's compensation for standing there.
On the interbank market that gap is minute — fractions of a hundredth of a percent on the most heavily traded pairs. By the time it reaches a bureau window it has become several percent, for reasons that have nothing to do with the market and everything to do with premises, cash handling and insurance. That journey is the subject of a separate piece on the spread.
The rate you see quoted as a single number is the midpoint of those two sides. It is a description of where dealers are, not a price anyone paid. What that midpoint is for, and where it genuinely binds, is covered in what the mid-market rate is.
Why the price moves at all
A rate moves when the balance of orders tips. If more money wants euros than wants to sell them, dealers raise their quotes until enough sellers appear. That is the entire mechanism, and everything else — interest rates, inflation figures, elections — matters only through it, by changing who wants to be on which side.
This is why a strong economic number can weaken a currency. What moves the price is not the number itself but the difference between the number and what the market had already assumed. If everyone expected a good figure, the buying happened days ago and the release changes nothing.
Where the published number comes from
If there is no single price, how does anyone publish one?
By taking a snapshot. The European Central Bank publishes euro reference rates on each working day, struck at 16:00 CET following a daily concertation procedure among European central banks. Other central banks do the equivalent for their own currencies, at their own times.
A snapshot is exactly what it sounds like: the state of the market at one moment, frozen and published so that contracts, customs declarations and accounts have a common number to point at. It is not an average of the day, and it is not valid for the day. Ten minutes after publication the market has moved on.
This is also why two official sources can print different figures for the same pair on the same date without either being wrong — they were struck at different moments, from different sets of quotes. On this site each rate carries its source and the moment it was taken, and the currency pages show the reference rate alongside a year of movement, so a single snapshot can be read in context rather than mistaken for a fixed price.
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Frequently asked questions
How an exchange rate is actually set, what a spread costs on a real transaction, what happens when your income and your debt are in different currencies, and what to check before paying or being paid abroad. They explain mechanisms rather than forecast rates, and each one carries the date it was last revised at the top.
No. We publish no forecasts, price targets or trading calls, and no article recommends buying or selling a currency. Exchange rates over short horizons are close to unpredictable, and a site that pretends otherwise is selling something. What the articles do instead is explain the mechanism, so that you can read the news for yourself.
They are written by the kursdanas.rs editorial team. We accept no commissioned or sponsored articles, and advertising has no influence on what is published or on the order of anything in our tables. Where an article states a figure it names the source, and where we get something wrong we correct it and change the revision date shown on the page.