If you’re comparing exchange rates trying to save money then there’s a good chance you’ve heard the term “mid-market rate.” What does it mean, though? This blog post will explain what the mid-market rate is, why it’s important to you, and how it impacts your daily life.
The international mid-market rate (IMM) is the average exchange rate between two foreign currencies. This is known as a mid-market rate because it is neither the rate at which banks trade and transact with each other, nor is it a retail exchange rate. It is also known as a wholesale or interbank exchange rate.
On BestExchangeRates each bank and FX provider’s currency exchange rates are compared to the mid-market rate. This mid-market rate is used in global financial markets and what you normally see reported on the news.
It is called the “mid-rate” because it is always half-way between latest BUY and SELL rates for the currency pair. The most important thing to know is that the mid-market rate is generally the best possible exchange rate available.
Generally they say when investing you should buy low and sell high and that is exactly what the banks are doing with you, they buy currency from you at low rates and sell currency back to you at high rates, so unfortunately you end up buying high and selling low!
That is why most banks and brokers hide this mid-rate from you by marking it up significantly – to their own benefit.
BER compares exchange rates from banks and FX specialists.
This site compare the rates FX providers are offering to this mid-market rate showing you the percentage margin (profit) that is being charged by the Vendor in the right hand column.
Once the margins are expressed in percentages (rather than just a rate) the margin you are being charged by each Vendor is much clearer & easier to understand.
The rates used in BestExchangeRates are aggregated from a number of markets and updated regularly through the day. You can check against finance.yahoo.com, xe.com or oanda.com to confirm that the rate used on BestExchangeRates is close to the current market rate.
BER is operated by Best Exchange Rates Pty Ltd ("We", "Us"), a company incorporated under the laws of Australia with company number 68082714841. BER is a comparison website only and not a currency trading platform. The information on this site is of a general nature only. It does not take your specific needs or circumstances into consideration. You should look at your own personal situation and requirements before making any legal, accounting or financial decisions. The foreign exchange rates and products compared on this page and website are chosen from a range of products that BER has access to and are not representative of all the products available in the market.
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