Exchange rates aren’t random. They move daily because of global supply and demand for different currencies. If more people want dollars than euros, the dollar goes up and the euro goes down.

Interest rates are a big driver. When a country raises its rates, investors often move their money there to earn more, which strengthens that currency.

Inflation also plays a role. Countries with higher inflation usually see their currency weaken over time.

Other factors include political stability, trade balances, and central bank decisions. Even major world events, like wars or elections, can cause sudden swings.

For travelers and businesses, this means the rate you see today may not be the same tomorrow. That’s why checking live converters before making payments is so important.