Economic Definition of foreign exchange market. Defined.
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Term foreign exchange market Definition: A market that trades foreign exchange. The currencies of the advanced nations, and many of the lesser developed ones, are at the top of what's traded in this market. The price at which one currency is traded for another in this market is the exchange rate. Like many "markets" this one is not located at any particular place, but includes transactions around the globe. As you might expect, banks handle a lot of these transactions.