The wholesale market often referred to as the interbank market is entirely different and the participants in this market are commercial banks, corporations and central banks. In other words, on demand, they will quote buying and selling rates for one currency against another and express willingness to take either side of the transaction. There are other players like the foreign exchange brokers, who are essentially middlemen providing information to marketmaking banks about prices and a counterparty to transactions. Brokers do not buy or sell on their own account, instead they pocket a commission on the deals that they have helped strike between two marketmaking banks. Central banks also intervene in the markets from time to time in order to move the market in a particular direction.
Corporations use the foreign exchange markets for a variety of purposes.
On the operational front, they use the foreign exchange markets for payments towards imports, conversion of export receipts, hedging receivables and payables positions and payment of interest on foreign currency loans take abroad. Companies that are cash rich tend to also park surplus funds and take active positions in the market to earn profits from exchange rate movements. There are others who, as a matter of company policy, restrict their participation to producing and selling of goods and services. Typically, interbank market deals are struck on the telephone. Subsequently, a written confirmation is sent containing all the details of the transaction.