Currencies are traded on the Foreign Exchange market, also known as Forex. This is a decentralized market that spans the globe and is considered the largest by trading volume and the most liquid worldwide. Exchange rates fluctuate continuously due to the ever changing market forces of supply and demand. Forex traders buy a currency pair if they think the exchange rate will rise and sell it if they think the opposite will happen. The Forex market remains open around the world for 24 hours a day with the exception of weekends.
Currency pairs of the Americas
The economies of the US and Canada play the key role in exchange rates across the 2 continents. Several countries have pegged their local currencies to the USD while countries such as El Salvador and Ecuador even use the USD as legal tender.
Currency pairs of the Caribbean
Currency pairs of the European countries
The list of European currencies is mostly based on the European countries with a developed economy. EUR dominates the region since most of the states have adopted the currency as legal tender. It is one of the most-traded currencies in the world along with the CHF and GBP.
Currency pairs of the Asian countries
Asian currencies are influenced by two major economies of the world - China and Japan. These large economies made substantial investments into the Asia-Pacific region that resulted in a strong growth of the currencies of South Korea, Singapore, Taiwan, Malaysia and Hong Kong. JPY is one of the most-traded currencies but unlike USD and EUR it is considered to be a safe haven currency.
Currency pairs of the Pacific countries
AUD and NZD are the noteworthy currencies in this region. Currencies of small island countries are displayed as well. Some countries in the region don’t have their own currency and use AUD and NZD as legal tender. These currencies are traded outside of the US and European trading sessions due to the geographical location and time zone of their respective countries. As a result, the trading activity is low compared to other trading sessions.
Currency pairs of the Middle-Eastern countries
Local currencies of the Middle-Eastern countries have a strong dependence on the export of raw materials and correlate with energy prices. Central banks of some of these countries have pegged their currencies to the USD which can potentially lead to a recession if oil prices remain low for a long period of time.
Currency pairs of the African countries
Currency pairs of the African continent are some of the least commonly traded ones due to the extremely low liquidity of such markets. Several countries of the African continent decided to abandon their currencies completely, replacing it with the USD.