What currency rate should I use? 2

[Sleidia]

Hi guys,

I'm wondering something about currency rates.

The European Central Bank says 1 EUR = 1.6707 AUD
(

http://www.ecb.int/stats/eurofxref/eurofxref-daily.xml

)

xe.com says that 1 EUR = 1.66423 AUD

1. why are the figures different?

2. on an ecommerce website, should I use the lowest rate or the highest one?

3. should I use ceil() or floor()?

Sorry for the dumb questions but I'm not good with things about money

Thanks!

 

[jpadie]

that depends what you are using the rate for. typical cash rates are interbank + 4%, credit card rates are interbank + 2% and bank lending rates can be anything in site.

if it is for a commerce site, then you should use the rate that your bank/PSP uses, as this will be the rate that you get.

the difference between published rates reflects the different banks over which the averages are taken by the relevant index, and potentially different points in time (start/close etc). i am surprised that there is such a large discrepancy though.

i have always found

http://www.oanda.com

very useful for fx rates.

 

[Sleidia]

Hi Jpadie

"if it is for a commerce site, then you should use the rate that your bank/PSP uses, as this will be the rate that you get."

Unfortunately, it's impossible. The system is supposed to work for different clients/merchants using different banks. Bank transfers are accepted too. So, it's impossible to know what bank/rates will be used.

The site has a pulldown menu allowing to show all the prices in the desired currency. If the displayed rates are different from those used during the payment it might be a problem.

Should I simply write a small notice saying that the rates shown on the site are not exactly accurate?

 

[vacunita]

Exchange rates change daily, so you would need to monitor the rates on a daily basis, and update values accordingly.

With that said, I hardly think less than 1 cent difference is that much unless you are producing transactions in the billions of euros. Google even has a different value for it: 1.66757835. Its very hard to be exact, when values change by the hour.

You can have a warning that the value might change, but should give a reasonable idea of what the exchange rate is, without being exact.




----------------------------------
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Unknown has caused an Unknown Error on Unknown and must be shutdown to prevent damage to Unknown.

 

[Sleidia]

Thanks Vacunita

Well, the site automatically checks whether the rates are up to date and store the new rates in a mysql table if the data is older than the present day.

Unfortunately, compared to xe.com, I have a 8 cents difference instead of just 1 cent oanda.com gives an even larger difference.

Yeah, the only solution I see is the warning/notice addition.

 

[jpadie]

i guess the more normal solution is for you to quote in a single base currency and just tell consumers that whatever this corresponds to an estimated value in another currency.

or, like many sites, build in a margin to take account of currency flux. so £1 = €1.5 (as opposed to 1.42 or whatever)

 

[Sleidia]

or, like many sites, build in a margin to take account of currency flux. so £1 = €1.5 (as opposed to 1.42 or whatever)"

OK, so what's the simplest way to convert 1.42 to 1.5?
Ceil() removes the decimal

 

[jpadie]

just apply a margin to the conversion rate.

 

[Sleidia]

Oh ok, I got it!
Now the trick is to find the right margin!

Thanks