WHAT is a FOREX QUOTE?

BASE vs QUOTE CURRENCY

The United States Dollar (USD) and the European Union Euro (EUR) are the dominant base currencies in terms of daily traded volume in the foreign exchange market. The British Pound (GBP), also called sterling, is the third ranking base currency. For any currency pair, as the base currency becomes more expensive, the forex quote will increase in value and as the base currency becomes cheaper, the forex quote will decline in value.

The USD based pairs are USD/JPY, USD/CHF and USD/CAD. These prices show the value of one U.S. dollar in terms of Japanese yen, Swiss francs and Canadian dollars, respectively.

The Euro based pairs are EUR/USD, EUR/JPY, EUR/GBP, EUR/AUD, EUR/CAD, EUR/CHF and EUR/NZD. These prices show the value of one Euro in terms of U.S. dollars, Japanese yen, British Pounds, Australian dollars, Canadian dollars, Swiss francs and New Zealand dollars, respectively.

The British Pound is the base for GBP/USD, GBP/JPY, GBP/AUD, GBP/CAD, GBP/CHF and GBP/NZD. These prices show the value of one British Pound in terms of U.S. dollars, Japanese yen, Australian dollars, Canadian dollars, Swiss francs and New Zealand dollars, respectively.

The Australian Dollar (AUD) is the base for AUD/USD, AUD/JPY, AUD/CAD, AUD/CHF and AUD/NZD. These prices show the value of one Australian dollar in terms of U.S. dollars, Japanese yen, Canadian dollars, Swiss francs and New Zealand dollars, respectively.

CURRENCY CROSS RATES

A cross rate is an exchange rate between two currencies where neither of the two currencies is the currency of the country where the currency pair is being quoted. For example, in the U.S., a GBP/CHF quote would be considered a cross rate whereas in the UK or Switzerland it would be one of the primary currency pairs traded. For traders based in the United States, a cross rate is simply a currency exchange rate that does not involve the U.S. dollar.