ulkomaanvaluuttoja

Ulkomaanvaluuttoja are currencies other than a country's domestic currency. When an individual or business holds or transacts in currencies of other nations, these are considered foreign currencies. The exchange rate, which is the value of one currency relative to another, determines how much of one currency is needed to purchase a unit of another. These exchange rates fluctuate constantly based on various economic and political factors.

Individuals might encounter foreign currencies when traveling abroad for tourism or business. They need to exchange their domestic currency for the local currency of their destination to make purchases. Businesses engage with foreign currencies when they import or export goods and services. For example, a Finnish company exporting to the United States will receive payment in US dollars, which they may then need to convert back to euros.

The international foreign exchange market, often called the forex market, is where these currencies are traded. It is the largest financial market in the world, operating 24 hours a day, five days a week. Central banks, commercial banks, investment firms, and individual traders participate in this market. Holding foreign currencies can be a way to diversify investments or to hedge against potential depreciation of the domestic currency. However, it also carries the risk of currency fluctuations, where the value of the foreign currency might decrease relative to the domestic one.