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The Euro - Foreign Exchange Rates
Introduction to FOREX and Holiday MoneyThere are two different kinds of exchange rate typically published online and in newspapers. There is the exchange rate on the world's financial markets (FOREX), and there is the exchange rate offered to consumers on the high street known as the tourist rate...
...For example, on Saturday 17th April 2005 on the financial markets £1 will buy €1.4977, and €1.4988 will buy you £1. The difference between the two values €1.4988-€1.4977 = €0.0011 (or 0.07%) is called the spread, and it is this difference that gives the money broker his profits. FOREX dealers will deal in millions of Pounds and Euros, and so the spread is very small. For the tourist rate the spread is much wider to cover the additional relative costs of dealing in smaller amounts and directly to consumers. Today the average high street exchanger was offering to sell €1.44 for £1, or to sell you £1 for €1.53 - therefore at a spread of €1.53 - €1.44 = €0.09 (or 6%!).
Buying Euros for a Property or other Large InvestmentWhen investing a large amount of money abroad it is essential that the spread is as small as possible to make your money go as far as possible. World First are one of the UK's leading foreign exchange providers and guarantee a better exchange rate not only than your bank, but also than any other currency companies' rates. Contact World First now to find out how much money you can save. Visit the World First website or call +44 20 7801 9080.
Commission Free Euro ExchangeBe very careful not to get too excited about commission free money exchanging, or companies which will buy currency back from you when you return from your holidays at 'no commission'. If you take £500 to a typical high street money exchange, have it converted to Euros and then immediately back into Pounds you will get back only £470 as £30 of your hard-earned cash disappears into the ether.
Buying Euros for your HolidayWhen you buy Euros for your stay in Italy, check the current FOREX rate and then try and find the high street rate nearest to this value. Don't forget to factor any extra charges for commission into your calculations.