Thursday, August 20, 2009


The foreign exchange market (currency, forex, or FX) trades currencies. It lets banks and other institutions easily buy and sell currencies. [1]

The purpose of the foreign exchange market is to help international trade and investment. A foreign exchange market helps businesses convert one currency to another. For example, it permits a U.S. business to import European goods and pay Euros, even though the business's income is in U.S. dollars.

In a typical foreign exchange transaction a party purchases a quantity of one currency by paying a quantity of another currency. The modern foreign exchange market started forming during the 1970s when countries gradually switched to floating exchange rates from the previous exchange rate regime, which remained fixed as per the Bretton Woods system.

Ringgit Closes Lower Against Greenback

-- The ringgit closed lower against the US dollar Wednesday in tandem with the easier Bursa Malaysia with the FTSE Bursa Malaysia KLCI ended 8.88 points lower to 1,155.53, dealers said.At 5pm, the ringgit declined to 3.5450/5490 against the greenback from 3.5370/5400 yesterday.A dealer said the weak ringgit was due to a rebound in US dollar, adding that the greenback was still well-supported."The weak ringgit could have triggered some exporters to unload the dollar. With the uncertainty over the global economy recovery, investors preferred the dollar," he said.Against other major currencies, the ringgit was traded mostly lower.It declined against the Singapore dollar to 2.4398/4449 from 2.4370/4414 on Tuesday and eased against the yen to 3.7581/7643 from 3.7146/7185 yesterday.The ringgit was also lower against the euro at 4.9974/9041 from 4.9967/9027 previously.It, however, rose against the British pound to 5.8085/8157 from 5.8159/8219 previously.-- BERNAMA
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