Forex majors are the most traded currencies in the foreign exchange market. These are the currencies that are most widely used in global trade and finance, and they are typically the most liquid and stable currencies. There are seven major forex pairs, which are the most actively traded currency pairs in the forex market. These major currency pairs include the US dollar, euro, Japanese yen, British pound, Swiss franc, Australian dollar, and Canadian dollar.
The US dollar is the most traded currency in the world, and it is involved in approximately 87% of all forex trades. This is primarily due to the fact that the US dollar is the primary reserve currency for many central banks around the world. As a result, the value of the US dollar tends to have a significant impact on global financial markets.
The euro is the second most traded currency in the world, and it is involved in approximately 31% of all forex trades. The euro is the official currency of the European Union and is used by 19 of the 27 member countries. The euro has been the subject of significant volatility in recent years due to concerns over the stability of the Eurozone and the ongoing Brexit negotiations.
The Japanese yen is the third most traded currency in the world, and it is involved in approximately 21% of all forex trades. The yen is often considered a safe-haven currency due to Japan’s strong economy and stable political environment. The yen is also used as a funding currency for carry trades, which involve borrowing in a low-interest-rate currency (such as the yen) and investing in a higher-yielding currency.
The British pound is the fourth most traded currency in the world, and it is involved in approximately 13% of all forex trades. The pound is the official currency of the United Kingdom and is also used in some British Overseas Territories. The pound has been subject to significant volatility in recent years due to the ongoing Brexit negotiations and the uncertainty surrounding the UK’s future relationship with the European Union.
The Swiss franc is the fifth most traded currency in the world, and it is involved in approximately 5% of all forex trades. The franc is often considered a safe-haven currency due to Switzerland’s stable political environment and strong economy. The Swiss National Bank has also been known to intervene in the forex market to control the value of the franc.
The Australian dollar is the sixth most traded currency in the world, and it is involved in approximately 5% of all forex trades. The Australian dollar is often used as a proxy for global commodity prices, as Australia is a major exporter of natural resources such as coal, iron ore, and gold. The value of the Australian dollar is also influenced by interest rates set by the Reserve Bank of Australia.
The Canadian dollar is the seventh most traded currency in the world, and it is involved in approximately 4% of all forex trades. The Canadian dollar is often correlated with the value of crude oil, as Canada is a major exporter of oil. The value of the Canadian dollar is also influenced by interest rates set by the Bank of Canada.
In conclusion, forex majors are the most traded currencies in the forex market, and they are typically the most liquid and stable currencies. The seven major currency pairs include the US dollar, euro, Japanese yen, British pound, Swiss franc, Australian dollar, and Canadian dollar. The value of these currencies is influenced by a variety of factors, including global trade and finance, interest rates, and political stability. Traders and investors should be familiar with these currencies and their underlying factors in order to make informed trading decisions in the forex market.
