This might be a silly question but do different banks give different exchange rates? I'm going to New York at xmas nd have been keeping an eye on the rates with the Irish Times website and XE.com which both give a rate of $1.43926 to the € but the BOI 365 online currency calc only give a rate of $1.3990 to €. Is there a way of getting the better exchange rate?
XE.com isn't the "retail" exchange rate, so it should only ever be used as a guide. The banks will never be at the same rate as it is.
The retail rate that you see in banks may be slightly different from one to another, but generally your talking in fractions.
Not meaning to thread hijack, but can anyone recommend a company that offers good rates when dealing with large sums of money?
All banks can do a better rate if you have enough to exchange.
The rate that you get from a bank will be marked-up, ie they will cut the rate by an set percentage which they take as their profit.
For example if you use a credit card abroad the normal mark up is often 1.75% - 2.75% (but can differ between issuers) so your rate will be approx 1.75% worse than what you see advertised as basic rate. Some of this may be kept by the bank and some by the scheme (eg Visa/MasterCard etc) - if you read the terms and conditions of your cerdit card/ATM Card/Debit Card it should give the mark up rate.
BOI CREDIT CARD = 1.75% cross border handling fee is charged per foreign currency Credit Card transaction outside the euro zone.
AIB CREDIT CARD = AIB MasterCard MasterCard AIB
FX Currency Transactions 0.16% 1.75%
AIB Visa AIB
FX Transactions - Visa Europe Region 1.75%
FX Transactions - Visa Rest of World 2.75%
Note: No currency conversion fees apply on Euro transactions.
MBNA - 2.65% commission on foreign currency transactions
If you go onto the banks websites you will be able to read the above clearer in a table. Search for terms and cnsitions of credit cards, ATM Card, Debit card (current account) etc
I should be working for the financial regulator. Pity I dont know what a tracker mortgage is.
If you re making a straight cash exchange in a bank say euro for dollors the rate is often worse again. You will see a buy and sell rate for dollars. The sell rate for FX$ will be higher than the buy rate (often up to 5% worse) - this is the banks profit. They will display both rates in branches.
Like any non-centralized, widely distributed market, the currency market has different prices when you're buying and when you're selling. As an example of how this market operatives, let's consider a similar and familiar market: antiques.
Let's say you find an antique lamp in your house. You look up the value of the lamp on the Internet and find that on average, the market value of your lamp is $200.
So you take the lamp to the antiques dealer and they offer $180 for your lamp. Yes, it may be technically worth $200, but the dealer has to buy it for a little less than market value in order to stay in business. So they buy the lamp from you for $180.
So next you go home, only to find out that the lamp was an important heirloom that should not have been sold. So you head back to the market to buy back the lamp. Luckily, they haven't sold it. You see the lamp in the store window, but now the price tag says $220! The dealer has marked the lamp up from market value in order to stay in business. So they sell the lamp back to you for $220.
In this example, the antique dealer's buy rate was $180, and their sell rate was $220. The average of the buy rate and the sell rate is the market rate, which was $200. However, it is important to note that no trade actually occurred for this amount. With the lamp, as with currency, nobody trades at the mid market rate. Anyone who did would lose money.
Of course, different dealers might have charged different amounts. One might have offered to buy the lamp for $150, another for $190. But in no case can dealers buy at more than the market rate, or sell at less than the market rate, without going out of business in the long run.
The exact same thing is true when dealing with currencies. All currencies have a market rate, and different dealers will set different buy and sell rates depending on the money they want to make. When converting from one currency to another, you are always buying one currency and selling another, so you will always get the buy rate from one currency and the sell rate from the other.
The further the buy and sell rates are from the market rate, the more the transaction costs you. Some dealers are very far from the market rate, whereas we at XEtrade strive to save you money by making our rates as close as possible.
In summary, buy and sell rates are prices set by currency dealers to stay in business.
When doing a conversion, our free currency information services always list the mid-market rate, since we can not know if you will be buying or selling a given currency. The mid-market rate is the most generally useful number, since it serves as a reliable, indicative value for the currency that is not weighted towards buying or selling.