Please provide a rating, it takes seconds and helps us to keep this resource free for all to use
Before we jump straight onto the currency calculators, we thought it useful to first take a look at the history of currency to understand why the world trades in currency.
What is currency? It can be defined in several ways, you can say currency most importantly is a medium of exchange of services and goods. Currency within each country becomes "officially recognized" in order to be considered legal tender and is typically provided in the form of paper notes and coins with the government defining its relative denominations.
Currency can be defined as a modern day replacement of the barter system. Where once, people used to give goods and services in exchange for other goods and services, we now exchange currency with an associated ratio to the goods or service provided. Currency has been with us since human society started evolving and becoming more social with currency being far more practical for transactions and allowing transactions to occur separately to the service delivery and/or receipt of goods. Currency paved the way for international trade.
The specific meaning of currency is money, that evolved into coins from barter over 3000 years ago. The first known kind of currency was established in 600 B.C. By Alyattas, the king of Lydia, It was minted with the image of a roaring lion. There were other coins with different animal images that defined the denominations, such as owl and snake etc.
Although the coins were popular they were heavy and when dealing in large exchanges very impractical to transport. The Chinese were the first to introduce paper money in early 1200 A.D. making currency at larger denominations more practical and easy to manage. The Chinese emperor issued currency notes in various denominations.
Europeans would wait a further 400 years or so before adopting notes, European countries were still focused on coins as currency until the banks started issuing currency notes in exchange for the face value of the coin in the 16th Century. Accessing notes was not that straight forward initially, you could walk into the bank and exchange your coins for paper money as they became widely accepted but not issued by the governments like today, they were issued by the banks as well as some private institutions.
Paper money is still in common use today but technology has facilitated electronic transfers and simpler centralized accounting by banks and financial organizations. Technology paved the way for "Plastic Money" with the introduction of the first credit card in 1946. It is not limited to paper coins and plastic nowadays. You have several ways to use money without even touching it, all you have to do is use a computer or a smartphone.
Today, we even have virtual currencies like Bitcoin, Monero, Peercoin, Ethereum, Litecoin etc. These currencies are different than the normal government-controlled currencies. These currencies are defined as alternative currencies and being referred to as crypto currencies. They are fully internet based and virtual, not stored anywhere and not even related to a particular country.
Pound sterling, US dollar, Japanese Yen and Euros are examples of a modern day currency. These currencies are considered major currencies of the world and they are traded between nations with each country having a relative value that changes depending on economic performance, stock market confidence and other social, political and economical factors. Almost anyone can now trade currencies in the foreign exchange market. The foreign exchange of currencies is generally referred to as the forex.
People from around the world make profits from forex trading, however, there are risks involved. Forex works with the exchange of one currency to another with profits leveraged based on the relative change in their respective values. If you want to learn more about the forex trading, you can refer to the following link and go through the details.
A key component in Forex trading is margin. The forex margin calculator provided by iCalculator can assist you in calculating and converting forex. The page below is equipped with a calculator and all the information you need to know about forex along with a detailed chart that shows you the currency rates of different currencies. You can access the calculator via the following link:
In almost all the countries there are central banks that are responsible for the administration distribution of currency notes and coins exclusively. These banks are responsible for production of currency and regulate it inline with the monetary policies of their respective countries, typically set by the government.
The currencies from different countries can be exchanged using an exchange rate, this is a key factor for international trade. If you study the currency exchange, thoroughly, you will see that these exchange rates keep changing (floating), these fluctuations are determined by the market with supply and demand an additional factor to the political, economic et al factors mention earlier.
However, it is worth noting that currency exchange rates can stay fixed, this is also defined as pegged rates. Pegged rates are determined by the government(s) and are set at a fixed rate of one country's currency against the currency of the other country, or multiple currencies or against the value of precious metal such as gold.
The authorities that control currencies in a country are either central banks or finance ministries that are generally defined as monetary authorities of a country. It is possible to have the same name for currency in different countries though the value differs between countries. A good example of common currency names is the dollar, you must have noticed that the currencies in the USA, Canada, Singapore and Australia are called dollars, however, they carry different values. Whereas, The Euro is a common currency in Europe though many European countries use their own currencies. Centralizing a common currency across different countries can create economic risk as countries lose the advantage or the "relative value of currency" which is key for influencing import and export levels and internal growth and international investment.
Although currencies are typically designed for use within a specific country, the international trade in currency, devaluation of certain currencies and demand for others means that certain currencies will be accepted outside of their native country. If you live in or are visiting El Salvador or Panama, you will notice that US Dollars (USD) is widely accepted and often preferred in certain areas / transactions. This is not because USD is the national currency of these countries, it happens when a country declares another currency as legal tender and that currency becomes more valuable (allowing traders to increase their return by selling the currency later for example).
When you want to exchange a currency with a different currency, the amount you will receive depends on the convertibility of a currency, this is the value of your local currency that you can get when exchanged with another country's currency. There are some currencies that are fully convertible such as USD. There are no limitations or restrictions on the amount, USD can be freely traded in the international market.
Some currencies are partially convertible because they are monitored by the controlling government when traded internationally, an example of this is Indian Rupees. Whereas, some currencies like Cuban Peso and North Korean Won are non-convertible. If you would like to find out more about exchange rates and calculate exchange rates of your currency, you can take advantage of the free online tools provided by iCalculator. These tools include exchange rate conversion and exchange rate calculation, specific calculators can be accessed with the following links: