24.05.2022 09:18












What is a cross currency exchange rate?

Cross exchange rates are essentially the same process of currency exchange, only in this case, the rate of one monetary unit against another is calculated through a third.

There can be different currency pairs involved in such an exchange:

  1. Euro dollar (USD/EUR);
  2. Dollar rubles (USD/RUB)
  3. Pound Sterling (GBP/USD)

Please note: the first in this pair is the base currency and the second is the quoted currency. In some exotic currencies it is difficult to determine the cross rate, because they simply may not have one. In this case, the trading process is only through the dollar.

Rules for calculating cross rates

The USD or EUR USD/EUR cross rate is calculated this way: first we take the individual value of each currency, and then we calculate the cross rate.

For example, a resident of Ukraine - a buyer, wants to buy currency from a resident of Canada. In order to complete the transaction, they need to calculate the ratio of the price of one currency to another, with the third currency being, say, the Euro.

In that case, there are a few steps involved in the process:

All I have to do is walk through the process.

  1. Purchasing of euro for hryvnias
  2. Purchasing of Canadian dollars for Euros.

I.e., in this transaction Euro acts as a currency through which the rate of UAH and Canadian dollar is calculated.

Calculate the rate you can use the formula above or use the online cross rate calculator.