Buying price in foreign exchange transactions

Purchase price（Buying rate/Bid rate）The buying exchange rate is the rate at which banks buy from customers or peersforeign exchangeThe exchange rate used.


Buying price The price is based on the market'sForeign exchange transactionsThe price at which a currency is prepared to be purchased in a contract or cross currency transaction contract. At this price, traders can sell the base currency. Located on the left side of the quotation, for example: USD/CHF 1.4527/32， The purchase price is1.4527; It means that investors can sell1 Buy in US dollars1.4527 Swiss Franc.


Buying is from the perspective of the bank. Buying is buying by the bank, which means we hand over foreign currency to the bank and exchange it for RMB.


The meaning of buying price varies under different pricing methods. Under the direct pricing method, the purchase price refers to the amount of local currency that a bank pays to customers by purchasing a certain amount of foreign currency. Banks implement the principle of buying at a low price and selling at a high price, with the purchase price being a smaller amount, which means paying customers less in the local currency when buying foreign currency. Therefore, under the direct pricing method, the buying price comes first; Under the indirect pricing method, the purchase price refers to the amount of local currency that a bank pays to customers by purchasing several foreign currencies. Banks implement the principle of buying at a low price and selling at a high price, where the buying price is a larger amount, which means paying customers a certain amount of local currency when buying a larger amount of foreign currency. Therefore, under the indirect pricing method, the buying price follows.