Foreign exchange retail market

Foreign exchange retail market

Foreign exchange retail market, also known as customer market, refers to the foreign exchange trading activities and places between banks and individual and corporate customers. Banks play an intermediary role in the foreign exchange transactions with customers. On the one hand, they buy foreign exchange from customers, on the other hand, they sell foreign exchange to customers, so as to earn the difference between foreign exchange sales and purchase. It is also the foreign exchange service business provided by banks to customers, which is the basis of the existence of foreign exchange market.

Trading customers are mainly industrial and commercial enterprises and institutions, importers and exporters, individuals, etc. due to the needs of international trade, international investment and other aspects, foreign exchange trading with banks constitutes the basic business of the foreign exchange market.

Foreign exchange retail market is mainly retail market, and retail business mainly includes: foreign exchange transactions between banks and individual and corporate customers, including currency exchange, import and export settlement and foreign exchange trading. Individuals and enterprises usually deal directly with banks. The customer market is dominated by sporadic transactions, without the minimum transaction amount limit, each transaction is relatively scattered, and the transaction volume is relatively small; the transaction cost is relatively high, and the bid ask price difference is large.