How to calculate the real exchange rate?

Hello, I would like to know how to calculate the real exchange rate.

Eduard
7 years ago
Steven J
Currexy.com
7 years ago

Eduard, the real exchange rate is the nominal exchange rate adjusted for the different rates of inflation between the two currencies. It is the purchasing power of a currency relative to another at current exchange rates and prices. This is the formula of the real exchange level:

Real exchangerate

R – the real exchange rate;
e – nominal domestic-currency price of foreign currency;
Pu – foreign price level;
P – domestic price level.

Best currency exchange tool.
Accurate currency conversion!
2024 © Currexy.com - Best currency exchange tool, currency converter of world currencies and cryptocurrencies.
Accurate live currency data, live charts, currency analysis, news, world banknotes.