FOREIGN EXCHANGE

The spot rate is the exchange rate at which a currency can be bought or sold for immediate delivery, typically settled within two business days of the transaction date.

System where central bank occasionally intervenes to influence currency value.

Nostro account (Latin for 'our account') is an account that a domestic bank holds in a foreign bank in the foreign bank's currency, used to facilitate foreign exchange transactions and international settlements.

Official reduction in currency's value relative to other currencies by government.

A Vostro account (Latin for 'your account') is an account held by a foreign bank at a domestic bank in the domestic currency, essentially the mirror image of a Nostro account from the domestic bank's perspective.

London Interbank Offered Rate, benchmark for international lending and forex settlements.

Exchange risk is the potential loss arising from adverse movements in exchange rates, affecting the value of foreign currency-denominated assets, liabilities, income, or cash flows.

Exchange of principal and interest in different currencies between two counterparties.