Interpretation of foreign exchange quotations : The way of foreign exchange quotations can be divided into direct quotation or indirect quotation.
direct quotation
The price quoted directly refers to several foreign currencies that can be converted into 1 US dollar . For example, when USD/JPY (USD/JPY ) is 117.15, it means that 1 USD can be exchanged for 117.15 yen. If USD/JPY is subsequently changed to 116.40, it means that 1 US dollar can only be exchanged for 116.40 yen now. In other words, the dollar depreciated against the yen earlier (at 117.15), while the yen appreciated. At present, the foreign exchange that is generally quoted directly is USD/JPY, USD/CHF (US dollar to Swiss franc ) and USD/CAD (US dollar to Canadian dollar).
indirect quotation
The price quoted indirectly means the price at which each unit of foreign currency can be exchanged for several US dollars. For example, when EUR/USD is 1.3015, it means that 1 euro can be exchanged for 1.3015 US dollars. If the EUR/USD is subsequently changed to 1.3080, it means that 1 euro can now be exchanged for 1.3080 US dollars. In other words, the euro appreciated against the dollar earlier (at 1.3015) and the dollar depreciated. At present, the foreign exchange that is generally quoted in short order is EUR/USD (EUR/USD), GBP/USD (GBP/USD ) , AUD/USD (Australian dollar/USD) and NZD/USD (New Zealand dollar/USD).
cross rate
A cross currency is any currency in which the U.S. dollar is not quoted. Common cross rates quoted are EUR/JPY (Euro/JPY), EUR/GBP (Euro/ GBP ) and GBP/JPY (GBP/JPY). For example, when EUR/JPY (Euro/Japanese Yen) is 148.70, it means that 1 euro can be exchanged for 148.70 yen, and if EUR/JPY is changed to 150.77 later, it means that 1 euro can now be exchanged for 150.77 yen. In other words, the euro appreciated against the yen earlier (at 148.70) , while the yen depreciated against the euro.