What do we mean when we talk about the official foreign currencies exchange rate? In all the countries in the world there is an official exchange rate according to the reference currency, the dollar, and also with the currencies of other countries.
The official foreign currencies exchange rate can be seen for example, when you fix an exchange rate for currencies. For example, the dollar exchange rate is the exchange rate of a currency according to dollars.
The official foreign currencies exchange rate stays in the same value beacuse of the authorities,in this case the Central Bank of each nation. This is the entity in charge of keeping the official foreign currencies exchange rate in the established levels, and so the monetary entity avoids the devaluation of the currency or the appreciation over the values established by the ones of the political economy.
Knowing the official foreign currencies exchange rate is something I should do if I choose to invest on foreign currencies. The difference that there is between the exchange rates of each country can help its economy. A dollar, for example, will not quote the same in Argentina or in Europe, as the argentine exchange rate is very devalued in front of american currency and euro is over the dollar value.
The official foreign currency exchange rate is one of the principal bases of the political economy of a country. On this decision depends which sector is being considered by an economic model, if a government decides to help exports it will probably devalue its currency according to the dollar to give an incentive to this sector. And if the model is trying to do the opposite it will probably appreciate local currency regarding to the dollar. This measure will help imports and stop national industry.