Foreign exchange fixing

Hey kiddo! Have you ever gone on vacation to a different country and had to exchange your dollars for local currency? Well, banks and big businesses do something similar, but on a much bigger scale!

When businesses trade with each other across borders, they need to exchange their currency to pay for goods and services. The price that they agree to exchange at is called the exchange rate.

Foreign exchange fixing is when big banks and financial institutions agree on what the exchange rate will be for a certain time period (usually one day) so they can buy and sell currencies at the same price. It's like they all agree to play a game with the same rules, so nobody can cheat and everyone is on the same page.

This fixing process happens every day and it helps businesses and investors know what the exchange rate will be, so they can make better decisions about buying and selling currencies.

Unfortunately, sometimes people try to cheat and manipulate the exchange rate so they can make more money. This is illegal and can be really bad for the economy. So, governments and financial regulators watch closely to make sure everyone is playing fair.

Overall, foreign exchange fixing is just a way for big banks and businesses to agree on the price of currencies so they can trade in a trustworthy and fair way.