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The rate at which one country's currency can be traded for another country's currency. A favorable nominal exchange rate can make a destination more affordable for tourists, leading to increased tourism spending.

The price of goods in one country compared to the price of goods in another country, after adjusting for the exchange rate. A lower real exchange rate for tourists can boost their purchasing power and encourage more spending in the host country.

When a currency increases in value relative to another currency. This can make outbound tourism more affordable for residents but can deter inbound tourism spending as the destination becomes more expensive for foreign tourists.

When a currency decreases in value relative to another currency. This can make a country a more cost-effective destination for tourists, potentially increasing inbound tourism spending.

The extent to which the prices of imported and exported goods change as a result of exchange rate movements. High pass-through can mean that tourists will see rapid changes in prices for tourism-related goods and services as exchange rates fluctuate.

An economic theory that estimates the amount of adjustment needed on the exchange rate between countries for the exchange to be equivalent to each currency's purchasing power. If PPP is in effect, tourists will find price levels for goods and services similar domestically and abroad, thus neutralizing the effect of exchange rates on tourism spending patterns.

The exchange rate between two currencies computed by using a third, typically stable, currency (often the US dollar). Cross rate dynamics may affect multilateral travel flows and spending when tourists come from a country whose currency isn't directly exchanged with the destination country's currency.