What does the quoted price mean when buying foreign exchange?

The quoted price in foreign exchange purchase refers to an exchange rate, that is, the exchange ratio between foreign currency and RMB. When banks purchase foreign currencies in the foreign exchange market, they need to use RMB as a method of payment, and the foreign exchange purchase price is based on RMB and corresponds to the exchange rates between different foreign currencies. The quoted prices in foreign exchange purchases are usually announced by state-authorized financial institutions and are constantly adjusted as the exchange rate fluctuates.

Foreign exchange transaction refers to the transaction of exchanging one currency for another currency, and the quotation price has become an important indicator for both parties to determine the transaction price. For example, if an investor wants to buy U.S. dollars, he will know based on the quoted price how many renminbi a local bank will exchange for one U.S. dollar. As the quotation price fluctuates, investors need to make a timely decision whether to operate based on market conditions.

Changes in quotation prices directly affect foreign exchange transactions in corporate and personal lives. For example, when the RMB appreciates, the cost for companies to purchase goods from foreign countries will be reduced, and consumption when traveling abroad for business or tourism will also differ due to exchange rate changes. However, when the price fluctuates greatly, companies and individuals may encounter exchange rate risks, resulting in more capital costs. Therefore, in daily life and economic activities, we need to always pay attention to and understand the changes in exchange rates in order to formulate more reasonable exchange rate operation strategies.