For a better understanding of the spread and the effects, it has on must understand the basic structure of forex trades in general. You can generalize the trade structure to all trades are via a middleman who charges for his services. Just like a majority of financial markets, you will typically see three prices, the buy price, the sale price, and the market price. The difference between the sell and buys prices is known as the spread.
Definition

Reason;
The main reason is supply and demand. Brokers will name have any problems at all in selling off the US dollars they purchased. Therefore there is no reason for them to charge you as a trader a greater spread. On the other hand, if the base currency of the position was the Vietnamese Dong, for example, they are likely to be higher. This ultimately means that the broker has taken a more significant risk, and therefore has to charge more for this risk. For this reason, I suggest that as an individual trader, avoid purchasing and selling low demand currencies. As it will be more costly. Seeing as we have understood that no matter how attractive forex trading is, it is not entirely free. Now we must also realize what differentiates stock market commission and forex spread. The main difference is – in forex you are only charged a spread on the buy side of the transaction. Brokers generally make a profit from charging you a spread when you buy a currency.How does Forex Spread work exactly?
If a broker buys and sells a currency without any change in the exchange rate, the person who would lose money is the trader. The trader would lose because the selling price is often always more than the buying price. Meaning that the broker will always profit from the transaction. A more familiar example is when you are traveling, and you exchange your money in a foreign bank. You will notice that every time they will offer more when buying your dollars than when selling them to you.
Who sets it?
The spread is determined by other market participants when it comes to trading assets such as shares commodities or forex, If you trade at the market price, the least price you can buy it at is the offer, and then sell it at the highest price which is the bid. Regarding trading derivatives such as spread betting or CFDs, your provider usually adds their spread on to the market price. This particular spread is the fee you pay for trading this derivative.