The.Foreign Exchange Market Foreign exchange means the money of a foreign country;that is,foreign currency bank balances,banknotes,checks and drafts. A foreign exchange transaction is an agreement between a buyer and a seller that a fixed amount of one currency will be delivered for some other currency at a specified date.The Foreign Exchange Market Foreign exchange means the money of a foreign country; that is, foreign currency bank balances, banknotes, checks and drafts. A foreign exchange transaction is an agreement between a buyer and a seller that a fixed amount of one currency will be delivered for some other currency at a specified date