Why Exchange Rates Change
Exchange rates move constantly. Understanding the main drivers can help you make sense of the numbers you see on our site.
Interest rates and central banks
When a central bank raises interest rates, holding that currency can become more attractive, which often strengthens the currency. When rates are cut, the currency may weaken. Central bank announcements and meeting minutes are watched closely by the forex market.
Inflation and economic data
High inflation can erode a currency's purchasing power and lead to depreciation. Employment, GDP, and trade balance data also influence how traders and investors value currencies, so rates can move when these figures are released.
Trade and politics
Trade surpluses or deficits, tariffs, and political stability (or uncertainty) affect confidence in a currency. Geopolitical events and policy changes can cause sharp moves in exchange rates.
Market sentiment
In the short term, speculation and risk appetite can push rates up or down. That's why we update our rates frequently—so you see the latest market level. For historical trends, use our rates and pair pages with historical charts where available.