What are currency pairs?

In the foreign exchange market, a currency pair is the estimate of one currency’s value relative to another. The currency used as a reference is called the quote currency, and the other one is called the base currency. The following are some of the key currency pairs: Also known as the Euro, it is the most popular pair.

What are the two elements required to make up a currency pair?

The two elements required to make up a currency pair are a base currency, and a quote currency. The base currency is the first abbreviated currency name that you will see, and the quote currency is the second. For example, if we take the currency pair EUR/USD, then the Euro is the base currency, and the US Dollar is the quote currency.

What is the ISO code for a currency pair?

So, for the U.S. dollar, the ISO code would be USD. A currency pair is a price quote of the exchange rate for two different currencies traded in FX markets. When an order is placed for a currency pair, the first listed currency or base currency is bought while the second listed currency in a currency pair or quote currency is sold.

What are examples of exotic currency pairs?

Some examples of crosses include the EUR/GBP, GBP/JPY, and EUR/CHF. Exotic currency pairs include currencies of emerging markets. These pairs are not as liquid, and the spreads are much wider. An example of an exotic currency pair is the USD/SGD (U.S. dollar/Singapore dollar).