What is Bid and Ask?
The bid is the price at which a market maker will buy a currency from you; the ask (or "offer") is the price they will sell it to you. The difference between them is the spread — how the market maker earns revenue.
Definition
Every currency quote in a live market has two prices: bid (what the market maker will pay you to take their currency in exchange for yours) and ask (what they will charge you to give you the currency you want). For retail customers, you always trade against the worse side of the spread: you buy at the ask, sell at the bid. Market makers (banks, brokers, exchange counters) capture the difference. The bid-ask convention applies to all financial markets, not just forex — stocks, bonds, options, and crypto exchanges all use it. In tight, liquid markets (EUR/USD interbank), bid-ask spreads are 0.1 pips or less. In illiquid markets (exotic pairs, weekends, after-hours), spreads widen to compensate for the market maker's risk of being stuck holding inventory.
Worked example
A bank quotes EUR/USD at "1.0850 / 1.0852" — bid is 1.0850, ask is 1.0852 (2-pip spread). If you want to sell €10,000 to get USD, you receive 10,000 × 1.0850 = $10,850. If you immediately reversed, buying €10,000 back at 1.0852, you would pay $10,852 — a $2 round-trip cost on $10,850. That $2 is the spread cost (~0.018%). At an airport exchange counter, the same trade might cost $200–500 round trip due to much wider retail spreads.
Why it matters
Understanding bid-ask helps you read currency quotes without confusion. When a converter or news outlet shows "EUR/USD = 1.0851," that's the midpoint of the bid-ask — you cannot actually transact at that exact rate as a retail customer. You'll get the bid if selling EUR, the ask if buying EUR. The tighter the spread, the closer your effective rate is to the displayed mid-market rate.
Live mid-market rates
See bid and ask in action with live rates.
Frequently asked questions
Why is "ask" sometimes called "offer"?
They mean the same thing. "Ask" is more common in US markets; "offer" is more common in European and Asian markets. Both refer to the price at which the market maker will sell the asset to you.
Are bid-ask spreads always shown?
In professional trading platforms, yes — quotes always show both. Consumer-facing tools (Google, retail bank apps, our converter) display only the mid-market rate for clarity. To see the actual bid/ask you'd be charged, you have to initiate a transaction at a specific provider.
Do bid-ask spreads vary by time of day?
Yes, significantly. Major pairs (EUR/USD) have tightest spreads during the London-New York overlap (13:00–17:00 UTC) when liquidity peaks. Spreads widen during Asian session and especially during the Friday-Sunday market close. Avoid converting large amounts during low-liquidity windows.
Related terms
Spread (Forex)
The spread is the difference between the buy (ask) price and the sell (bid) price of a currency. For retail customers, this gap is the primary way exchanges, banks, and brokers earn revenue — often disguised as a "commission-free" service.
Mid-Market Rate
The mid-market rate is the midpoint between the buy (bid) and sell (ask) price of a currency in the global interbank market. It is the fairest reference rate available and what Google, Reuters, Bloomberg, and Wise all display as "the exchange rate."
Pip (Forex)
A pip ("percentage in point") is the smallest standard price increment for a currency pair, typically the fourth decimal place (0.0001) for most pairs or the second decimal place (0.01) for pairs involving the Japanese Yen.