Calculating Cross Rate for EURGBP?

Trading Discussion Currencies
1

Hey all,

I was just reading the BP article about cross rates and was wondering how you would manually calculate it for EURGBP.

The article was trying to solve for GBPJPY w/ GBPUSD and USDJPY, so I figure I need EUR/XXX and XXX/GBP. Thing is, I can’t find a currency pair with GBP as the quote.

Thanks.

2

You can find the EURGBP pair on Tradingview: Live stock, index, futures, Forex and Bitcoin charts on TradingViewEURGBP

3

The common yard stick for currency value is measured against the US Dollar.
So to calculate rate for EURGBP you use EURUSD and GBPUSD. Since you have GBPUSD instead of USDGBP you need to invert GBPUSD that is 1/GBPUSD then you will have EURUSD and USDGBP. Then you already know the method from the other example.

But since you already have EURGBP available why even bother? Unless you are trying to race super fast computers with extremely fast connections to the market to do arbitrage.

1 Like
4

That makes sense. Thank you.