Major Currency Pairs

Name one market which never closes, has the highest turnover volume in the world with people from all countries in the world participating in its day-to-day working. Yes, you guessed it right. It is the foreign exchange market, which extends its dominion all over the world. The market emerged out of a need for a system to facilitate the exchange of different currencies around the world, for the purpose of trade. Now it is the premier financial market of the world, which reflects the financial dynamics of world trade quite clearly. Every trade here is an exchange between currency pairs of two different countries.

As the famous Hollywood movie 'Wall Street's' tag line says, money never sleeps and in case of the foreign currency exchange market it is literally true. As the Earth revolves around herself, sun rises and falls, the forex markets world over, keeps on opening and closing in order to facilitate uninterrupted currency trade.

About Currency Pairs

Foreign exchange trade or forex trading is all about buying and selling currencies in pairs or rather exchanging one for the other. For buying and selling currencies, one need to have information about how much one of the currencies in the pair is worth in terms of the other. The statement of this relation is made in terms of a currency pair. So a currency pair is the quoting of two currency abbreviations followed by a listing of the value of base currency with reference to the counter currency. The foreign exchange rates are decided by the import and export volumes between two countries.

There is an international code which specifies the nomenclature for stating currency pairs. For example, a quote like EUR / USD 1.23 means that 1 Euro is worth 1.23 USD. Here the base currency is Euro (EUR) and the counter currency is US dollar. Thus, every currency pair is listed in the foreign exchange markets across the world.

Major Currency Pairs of the World

Not surprisingly, the most dominant and strongest, as well as most widely traded currency is the US dollar. It features in all the major pairs of the world listed below. The reason for this is the sheer size of the US economy which makes it the biggest economy in the world. US dollar is the currency that is the preferred reference in most currency trading transactions around the world. It is the dominant reserve currency of the world. Following are the major pairs that have high liquidity and take up the major share of forex transactions.

• EUR/USD (Euro - US Dollar)
• USD/JPY (US Dollar - Japanese Yen)
• GBP/USD (Pound Sterling - US Dollar)
• AUD/USD (Australian Dollar - US Dollar)
• USD/CHF (US Dollar - Swiss Franc)
• USD/CAD (US Dollar - Canadian Dollar)

The values of these major currencies keep fluctuating according to each other, as the trade volumes between two countries keep changing every year. For the latest currency exchange rates, refer to sites that offer live foreign exchange reports. They even have currency converters, which can calculate the value of a currency with reference to another, at the current market value.

These major pairs are naturally associated with countries that are financial superpowers with high volume of trade conducted all over the world. The dynamics of the foreign exchange trade is an interesting subject of study as it can provide you with a pulse of the world economy, along with its rising and falling financial fortunes. As the wave of globalization engulfs most countries around the world, the fates of these major pairs are inextricably intertwined. Make sure that you study the foreign exchange market thoroughly before making an investment in this market which never sleeps!