Foreign Exchange Glossary

Gross Domestic Product (GDP)

A nation’s Gross Domestic Product (GDP) is worked out by taking the value of all the goods and services produced by the nation and subtracting the cost of any goods/services used in their creation. Overseas earnings/investments don’t come into the calculation of GDP.

GDP per head gives you a rough figure for a nation’s output per person and means that countries relative wealth can be compared. It is calculated by taking the total GDP of a country and dividing it by the amount of people who live within it.