In this latest blog in a series looking at the ever-closer link between FX and technology, we explain why application developers are increasingly needing to build FX functionality into their products.
Anyone remember former Microsoft CEO Steve Ballmer’s rousing speech to the developer community? With real-time exchange rate APIs at the heart of application development, perhaps developers should be addressed with the same sort of vigor and passion displayed by Ballmer many moons ago. Particularly as today, developers play an increasingly important role in the day-to-day financial operations of global businesses.
For any company with wide international reach, using FX in their daily operations, which requires accurate and reliable rates, is becoming an increasingly important part of decision making. Developers, as well as IT teams working for these businesses often utilize real-time exchange rates API to power products and web applications. This includes integrating FX data feeds via an API to execute operations such as currency conversion, interactive charting, and powering pricing engines to name just a few.
To put this into context, take the example of a U.S company providing information on precious metals to customers via a web application. The firm in question could use historical data to create long-view interactive charts and utilize real-time rates for pricing. The firm’s customer base could range from jewelers, dentists or pawnshop owners, to anyone paying cash for gold, silver, platinum or scrap metal. Historical data enables the company to assess the price of scrap metal based on multiple factors, including hardness and purity. But there is just one problem, the market rates of precious metals fluctuate frequently. Gains on silver were nearly twice those on gold back in January, and while both beat the S&P 500, silver has continued to bounce up and down since. And this is exactly why, in order to best serve their client base, the U.S firm supplying data in precious metals needs real-time rates to keep on top of fluctuating prices.
Importantly, these real-time rates have to be extremely accurate. For a customer, take a jeweler, the price of silver could have a real impact on their bottom line. They need to know the rates they are receiving are as accurate as possible. The company providing the information therefore has to know that the data it is hosting is spot-on, and it can only achieve this certainty with state-of-the-art infrastructure and a bullet proof data feed API. And it’s not just for the benefit of the customer. If a company is pricing a product in local currency, then it’s in its interest to provide the most accurate FX rates to protect its own profit margins.
It is, therefore, clear why developers will be looking for a reliable and secure data feed API that can be integrated easily into their ecosystem. Automated exchange rate functionalities are a great way for a business to price products automatically and accurately wherever they are offered. For developers, having an exchange rate API that is easy to integrate not only supports product development, but it also increases their value across the business as the process for managing FX rates continues to evolve.