Exchange rates represent the value of one currency in relation to another. They fluctuate based on various factors, including economic indicators, interest rates, and geopolitical stability. For instance, the exchange rate between the US Dollar and the Euro can change daily, affecting international trade and travel costs. Understanding exchange rates is crucial for businesses and travelers alike. A favorable exchange rate can lead to significant savings when converting currencies. Additionally, fluctuations in exchange rates can impact investments and the overall economy, making it essential for individuals and companies to stay informed about current rates and trends.