Foreign Exchange Markets
Foreign exchange markets set the value of currencies against one another, influencing the price of products and services worldwide. If one country has a cheaper or undervalued currency, it can produce and sell products to the world at a lower price. Read this section to learn more.
The Foreign Exchange Market
Answer to Try It Question
a. An American manufacturer buys Euros to purchase parts from a German supplier.
Correct. The purchase or sale of foreign currencies is done through the foreign exchange market.