This article is dedicated to describing the most important currencies employed in the Forex market. On the Forex market, there are 5 major currencies that are used in the transactions.
The first currency is the American dollar (U.S Dollar). It is the world's main currency being used as an universal measure to assess the other currencies traded on Forex. This is why all currencies are quoted in terms of the American dollar. This privileged status has resulted from the fact that this currency was the most stable during the most troubled periods. It became the leading currency at the end of the Second World War. It was only in 1999 when the Euro was introduced, that the U/S dollar has lost some of its importance.
The Euro was introduced with the intention of becoming the premier currency in trading. Like the U.S dollar, the Euro boasts a strong relevance in the currency market. However, high unemployment, government resistance to structural changes plagued the growth of the Euro.
A third most traded currency in the world, the Japanese Yen. has a much smaller international presence than the two currencies earlier mentioned. It is very liquid around the world, the demand to trade it being concentrated mostly among the Japanese economic and financial conglomerates.
The British Pound was a reference currency until the end of the Second World War. Although heavily traded against the Euro and the U.S dollar, the British Pound has a spotty presence against other currencies.
The fifth important currency on the Forex market is represented by the Swiss Franc and it is the only major European currency that doesn't belong either to the European Monetary Union, or the G-7 countries. It is a major currency and closely resembles the strength and quality of the Swiss economy and finance even though the Swiss economy is relatively small. From a foreign exchange point of view, the Swiss franc has similar patterns with the Euro, but lacks its liquidity.
The first currency is the American dollar (U.S Dollar). It is the world's main currency being used as an universal measure to assess the other currencies traded on Forex. This is why all currencies are quoted in terms of the American dollar. This privileged status has resulted from the fact that this currency was the most stable during the most troubled periods. It became the leading currency at the end of the Second World War. It was only in 1999 when the Euro was introduced, that the U/S dollar has lost some of its importance.
The Euro was introduced with the intention of becoming the premier currency in trading. Like the U.S dollar, the Euro boasts a strong relevance in the currency market. However, high unemployment, government resistance to structural changes plagued the growth of the Euro.
A third most traded currency in the world, the Japanese Yen. has a much smaller international presence than the two currencies earlier mentioned. It is very liquid around the world, the demand to trade it being concentrated mostly among the Japanese economic and financial conglomerates.
The British Pound was a reference currency until the end of the Second World War. Although heavily traded against the Euro and the U.S dollar, the British Pound has a spotty presence against other currencies.
The fifth important currency on the Forex market is represented by the Swiss Franc and it is the only major European currency that doesn't belong either to the European Monetary Union, or the G-7 countries. It is a major currency and closely resembles the strength and quality of the Swiss economy and finance even though the Swiss economy is relatively small. From a foreign exchange point of view, the Swiss franc has similar patterns with the Euro, but lacks its liquidity.
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