Valutagebied

Valutagebied is a term used in foreign exchange to refer to the bid price for a foreign currency. It is the price at which a bank, broker, or exchange is willing to buy the foreign currency in exchange for its own currency. In currency quotes, a two-way quote is commonly presented as valutagebied (bid) and valuta-ask (ask). The valutagebied represents the amount of domestic currency that the institution will pay per unit of the foreign currency. The valuta-ask is the amount of domestic currency required to buy one unit of the foreign currency. The difference between the two prices is the bid-ask spread, which covers transaction costs and risk.

Example: If EUR/USD is quoted as 1.10/1.12, the valutagebied is 1.10 and the valuta-ask is 1.12. This means the bank will buy euros at 1.10 USD per euro and sell euros at 1.12 USD per euro. If you exchange USD to EUR, you effectively pay the higher valuta-ask; if you exchange EUR to USD, you receive the lower valutagebied.

Context and usage: Valutagebied is used by banks, currency exchange offices, and online platforms to indicate the rate at which they are willing to buy foreign currency. Rates can vary by institution, currency pair, liquidity, and market conditions. They can be fixed for a period or updated in real time and are commonly higher for cash transactions and at scattered outlets, such as airports, than for online transfers.

In summary, valutagebied is a key component of foreign exchange quotes, reflecting the price a provider offers to pay for foreign currency and shaping the cost of currency conversions for customers.