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dash_zero | 08:10 Sat 23rd Jul 2005 | Business & Finance
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why is it more expensive to buy currency then to sell?
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The exchanges (e.g., Bureau de Change) make a profit on it. 

E.g.,

You give them �15 and they give you �10

Now, you need to give them �11 to get your �15 back - so they make �1 profit. 

It's just simple profit making.  Nothing more than that.  (As far as I know!  Perhaps someone else can confirm or deny)

acw is quite correct. Most companys will have a spread of 5-10% on the buying and selling rates, this is for a number of reasons.
Exchange rates fluctuate and they have to keep a large stock of currency on hand to sell (possibly purchased when the rate was lower). Funds held in cash offer no investment potential e.g they do not make interest on the funds. It's also expensive to handle cash compared to elctronic payments and lastly of course they are hoping to make a profit !
khana - Cor you can tell I'm a lawyer can't you!!??  I thought of profit straight away, and didn't actually stop to consider covering staffing costs first!!  Or the fluctuations they need to self-insure against!  Silly me!

You can also look at it in terms of supply and demand, one of the market forces which influences the price of any product.

When you want/need to buy an item you increase the DEMAND for that item; prices are high.
When you want/need to sell an item you increase the SUPPLY of that item; prices are low.

Admittedly this truism may be of little consequence in the fast-changing pricing equation for currency.

It also depends on the currency involved, that is how people make money on currencies, like shares.
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thanks for the answers guys

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