How do banks buy foreign exchange?

Bank foreign exchange transactions now mainly include counter transactions, self-service terminal transactions and online transactions.

Counter trading: You can use your foreign currency passbook, certificate of deposit, cash or 19-digit savings card to fill in an application for personal foreign exchange trading at the business outlets where the Bank has started personal foreign exchange trading business, and conduct real-time trading or entrusted trading.

Self-service terminal transaction: The Bank has self-service terminal equipment at personal foreign exchange trading outlets. You can complete foreign exchange trading, inquiry and voucher printing according to the prompts in the operation interface.

Online transaction: log on to the website to sign the contract. After passing the certification, you can conduct personal foreign exchange trading through online banking.

Foreign exchange is the creditor's rights held by the monetary management authorities (central bank, monetary management institutions, foreign exchange stabilization fund and Ministry of Finance) in the form of bank deposits, treasury bonds and long-term and short-term government securities. , which can be used when the balance of payments is in deficit.

Including foreign currency, foreign currency deposits, foreign currency securities (treasury bonds, treasury bonds, corporate bonds, stocks, etc.). ) and foreign currency payment vouchers (bills, bank deposit vouchers, postal savings vouchers, etc.). ).

According to the degree of restriction: it is divided into freely convertible foreign exchange, limited freely convertible foreign exchange and bookkeeping foreign exchange.

Freely convertible foreign exchange is the most used foreign exchange in international settlement, which can be bought and sold freely in the international financial market, can be used to pay off creditor's rights and debts in international finance, and can be freely converted into currencies of other countries. Such as US dollars, Hong Kong dollars and Canadian dollars.

Limited freely convertible foreign exchange refers to foreign exchange that cannot be freely converted into other currencies or paid to a third country without the approval of the issuing country. According to the regulations of the International Monetary Fund, all currencies with certain restrictions on international current payments and capital transfer are restricted freely convertible currencies. More than half of the national currencies in the world are limited convertible currencies, including RMB.

Bookkeeping foreign exchange, also known as clearing foreign exchange or bilateral foreign exchange, refers to foreign exchange deposited in bank accounts designated by both parties and cannot be converted into other currencies or paid to third countries.

According to source use: it is divided into trade foreign exchange, non-trade foreign exchange and financial foreign exchange.

Trade foreign exchange, also known as physical trade foreign exchange, refers to foreign exchange derived or used in import and export trade, that is, international payment means formed by international commodity circulation.

Non-trade foreign exchange refers to all foreign exchange except trade foreign exchange, that is, all foreign exchange that is not derived from or used for import and export trade, such as labor foreign exchange, remittance, donation foreign exchange, etc.

Different from trade foreign exchange and non-trade foreign exchange, financial foreign exchange belongs to a kind of financial asset foreign exchange, such as inter-bank trading foreign exchange, which is neither derived from tangible trade nor intangible trade, nor used for tangible trade, but used for the management and manipulation of various currency positions.

According to the market trend: it is divided into hard foreign exchange and soft foreign exchange, or strong currency and weak currency.