Cross Exchange Rate Calculator
Calculate cross exchange rates between two currencies using a common third currency
Calculate Cross Exchange Rate
First Currency Pair
Reciprocal: N/A
Second Currency Pair
Reciprocal: N/A
Cross Exchange Rate Results
Example Calculation
EUR/GBP Cross Rate via USD
Given rates:
• EUR/USD = 1.1000 (1 Euro = 1.1 US Dollars)
• GBP/USD = 1.2500 (1 Pound = 1.25 US Dollars)
Find: EUR/GBP cross rate
Step-by-Step Solution
1. Both rates have USD as denominator
2. Use formula: EUR/USD ÷ GBP/USD = EUR/GBP
3. Calculate: 1.1000 ÷ 1.2500 = 0.8800
Result: 1 EUR = 0.8800 GBP
Reciprocal: 1 GBP = 1.1364 EUR
Calculation Methods
Same Denominator
A/C ÷ B/C = A/B
Direct division when both have common currency as denominator
Same Numerator
C/B ÷ C/A = A/B
Division when both have common currency as numerator
Mixed Order
A/C × C/B = A/B
Multiplication when currencies are in chain order
Exchange Rate Tips
Direct vs Indirect
Know whether rates are quoted as direct (home/foreign) or indirect (foreign/home)
Reciprocal Rates
If A/B = X, then B/A = 1/X
Cross Rate Benefits
Useful when direct currency pairs aren't readily available
Real-time Rates
Use current market rates for accurate calculations
Understanding Cross Exchange Rates
What is a Cross Exchange Rate?
A cross exchange rate is the exchange rate between two currencies that is calculated using a third common currency. This is particularly useful when the direct exchange rate between two currencies is not readily available or when you need to convert through an intermediary currency.
When to Use Cross Rates
- •Direct currency pair not available
- •Travel to multiple countries
- •International trade transactions
- •Forex arbitrage opportunities
Calculation Methods
Four Main Scenarios:
1. A/C and B/C: Divide first by second
2. C/A and C/B: Divide second by first
3. A/C and C/B: Multiply both rates
4. C/A and B/C: Divide second by first
Key Principle
The common currency must cancel out in the calculation, leaving you with the desired cross rate between the two target currencies.
Cross Rate Applications
Travel & Tourism
Calculate exchange rates when traveling through multiple countries with different currencies.
International Trade
Determine costs and pricing when dealing with suppliers and customers using different currencies.
Investment Analysis
Analyze investment opportunities and returns across different currency markets.