The 5 Most Traded Currency Pairs in 2022

But good investing practices always have one eye pointed to the future. To wrap up our list of Forex statistics, let’s take a look at what will undoubtedly be the next big thing in Forex. Cryptocurrency is a relatively recent phenomenon. Unless you’ve been living under a rock for the past five years, you’re more than likely aware of these new digital currencies, their potential, and their wild and often unpredictable fluctuations. The Forex market is the largest and most liquid asset market on earth.5BIS, “BIS Quarterly Review”, accessed June 27, 2020. But that isn’t quite the end of the story.

Although the US Dollar has been forecast to eventually surrender its dominant global position to the Euro, the US currency remains a safe haven in times of crisis and the key global reserve currency. With a daily average volume of $550+ million , the Yen also makes up 4.9% of global currency reserves. The United States dollar is the most commonly traded currency in the world, and therefore most major forex pairs include the USD as the base or quote currency. When combined with other currencies from some of the world’s biggest economies, including China, Japan and the United Kingdom, these are seen as major crosses. ​​ is open 24 hours a day, from Sunday evening until Friday night, which takes advantage of the international time zone differences of London, Tokyo and New York.

Which currency pair is most profitable in forex 2020?

EUR/USD. The Euro/US dollar pair is regarded as the most profitable currency pair in forex for the following reasons; High Liquidity: The European economy is the second-largest globally, while the US is the largest.

Today, the Canadian dollar is one of the top ten most traded world currencies. The Swiss franc is the legal currency of Switzerland and was introduced in 1850. At the time, it was pegged to the value of gold. It is popular to buy the Swiss franc during times of economic hardship because it is considered a stable currency.

With the euro being a widely used and trusted currency, it is prevalent in the forex market and adds liquidity to any currency pair it trades with. The euro is commonly traded by speculators as a play on the general health of the eurozone and its member nations. At CMC Markets, we offer both spread betting​ and CFD trading​ opportunities for over 300 forex pairs, including all major crosses.

The Japanese Yen drives the global carry trade. Investors borrow Yen at low-interest rates and re-invest in higher-yielding currencies offshore. By doing this, they lock in higher interest profit on their investment than what they’re paying on loan. The United States of America is the world’s largest economy, and USD price largely hinges on economic performance back home. The US Dollar comes in at number 1 on our list of the most traded currencies in the world, thanks to 87% of all currency trades involving the Greenback. The South African Rand trades at aroxund 15.34 ZAR for 1 USD.

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The Australian Dollar is known primarily as a commodity currency. This is due to Australia being a major exporter of commodities such as coal and iron ore. As a result, commodity prices and global demand strongly influence the price of the Aussie.

most traded currencies 2020

The US is the world’s largest and one of the most stable economies, which has helped the dollar become the world’s dominant currency. The USD/EUR is the third most common currency pair in the Japanese market, representing 9.2% of all trades. Three years ago, umarkets this currency pair accounted for 8.6% of trades. The average daily turnover of the USD/EUR pair in the Japanese market is worth $34.7 billion.89BOJ, 2019 Central Bank Survey of Foreign exchange and Derivatives Market Activity”, accessed July 1, 2020.

Forex Trader Demographics and Statistics ‍‍

CoinCasso, «10 interesting facts about cryptocurrency exchanges!», accessed July 1, 2020. BOJ, 2019 Central Bank Survey of Foreign exchange and Derivatives Market Activity», accessed July 1, 2020. BOJ, «2019 Central Bank Survey of Foreign exchange and Derivatives Market Activity», accessed July 1, 2020.

Which currency moves the most pips?

  • AUD/JPY (Australian Dollar/Japanese Yen)
  • NZD/JPY (New Zealand Dollar/Japanese Yen)
  • AUD/USD (Australian Dollar/US Dollar)
  • CAD/JPY (Canadian Dollar/Japanese Yen)
  • AUD/GBP (Australian Dollar/Pound Sterling)

This means that central and commercial banks hold it throughout the world for investments and daily transactions. The official currency of the United States of America, the US Dollar, is also the world’s primary reserve currency. Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage.

“The Gopher” is a combination of the US dollar and the Japanese yen. It is one of the most popular forex pairs in the world due to the prominence of the JPY throughout Asia and the USD worldwide. It boasts a high liquidity, meaning that traders can buy and sell the currency pair in large volumes without the price fluctuating too much in its exchange rate. It also has one of the tightest spreads in the forex market, reducing the overall costs of the trade.

That makes it the de facto global currency, even though it doesn’t hold an official title. In addition, it can be easier to research economic events and trends as they tend to be covered daily by news outlets and talked about on social media. The Japanese Yen is the third most traded currency globally and a popular reserve currency.

Taking Advantage of the Most Traded Currencies in the World

Check out these remarkable facts about what makes some of these currencies so popular. In order to join the euro area, EU member states are required to fulfil so-called ‘convergence criteria’. They try to keep their currencies cheaper in comparison so their exports are competitively priced. Almost 40% of the world’s debt is issued in dollars.

The exchange rate also relies on changes to interest rates which are announced by regional banks, therefore, one currency can suddenly strengthen against the other, making the pair much more volatile. This also applies to the other currency pairs on this list. The U.S. dollar dominated the list of the most traded currency pairs in 2020, being involved all of the top seven. The most common forex transaction in that year was the euro and the U.S. dollar, which account for almost 28 percent of all currency exchanges.

most traded currencies 2020

The New Zealand dollar is the official currency of New Zealand and the tenth most traded globally, accounting for a daily average volume of US$68 billion. Like the krona, it is not a major reserve currency. It is issued by the Reserve Bank of New Zealand. China, for instance, has long had its currency, the yuan or renminbi, pegged to the dollar, much to the disagreement of many economists and central bankers. Top 25 most traded currencies Being the largest and most attractive for traders worldwide the global foreign exchange market is growing year by year. Large financial institutions and dealers are buying and selling here a huge amount of different currencies (its daily turnover already exceeds $5 trillion).

Issued by the Bank of England, the Pound is an iconic currency that plays an integral part within London’s institutional forex trading Hub. Issued by the Bank of Japan , the Yen is considered a safe haven currency due to Japan’s ultra-low interest rates, low what is forex and how does it work debt, and high trade surplus providing stability. Keep up to date with our news and analysis section of the website, which can provide insight and predictions into future movements in the forex market. The Kenyan Shilling trades at around 110 KES for 1 USD.

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Currency pairs that do not include the US dollar are known as minors or cross-currency pairs. Some of the most popular minor pairs are EUR/GBP, GBP/AUD, GBP/JPY, CAD/JPY, and EUR/NZD.48BIS, “Triennial Central Bank Survey”, accessed June 29, 2020. The USD/CHF pair often called Swissy, made up 3.6% of forex transactions in 2019.

It revealed the difficulties of a monetary union that’s guided by separate political entities. Kimberly Amadeo is an expert on U.S. and world economies and investing, with over 20 years of experience in economic analysis and business strategy. She is the President of the economic website World Money Watch. As a writer for The Balance, Kimberly provides insight on the state of the present-day economy, as well as past events that have had a lasting impact. Japanese yen – Historically, the Japanese yen has proved on multiple occasions its ability to rise from the ashes of market volatility and uncertainty.

The first currency in a currency pair is called the base currency while… When trading in the markets, people buy and sell financial products by “going long” or “going short” on them. “Going long” is a popular term used in the industry to describe the act of… The second-largest cryptocurrency, Ethereum, has a market capitalization of $19.4 billion.93Yahoo Finance, “Top 10 Cryptocurrencies by Market Capitalisation”, accessed July 1, 2020. Japan’s share of the global forex turnover is 4.5%.54BIS, “Triennial Central Bank Survey”, accessed June 29, 2020.

This article is a guide to five of the most traded currency pairs on our platform. If you’re new to forex trading, you can open a demo account to practise in a risk-free environment with £10,000 in virtual funds. This will also give you access to IG Academy where you can learn how to analyse and trade currency pairs. The euro is the official currency of the European Union and the second most traded globally, accounting for a daily average volume of nearly US$1.1 trillion.1 It is issued by the European Central Bank .

Cryptocurrency CFDs allow you to speculate on the price movements of cryptocurrencies without a crypto wallet. There are approximately 11.3 million crypto traders in Europe.97Chappuis Halder, “How Many Active Crypto Traders are There Across the Globe? There are approximately consulting website design 15.3 million crypto traders in the United States.96Chappuis Halder, “How Many Active Crypto Traders are There Across the Globe? There are approximately 43 million crypto traders in the world.95Chappuis Halder, “How Many Active Crypto Traders are There Across the Globe?

The World’s 10 Most Traded Currencies

Although it is one of the most stable currency pairs to trade and therefore offers many benefits. However, when the markets are in a more stable position, the USD/CHF may be of less interest to traders who opt for other major currency pairs that are featured on this list. The Swiss franc is the legal tender of Switzerland and Liechtenstein. Issued by the Swiss National Bank, its average daily trading volume is around $165 billion. The Swiss franc accounts for 5% of global forex trades.

most traded currencies 2020

These countries include Ecuador, Panama and El Salvador, among others. GBP is the abbreviation for the British pound sterling, the official currency of the United Kingdom and its territories. The Canadian dollar, nicknamed the loonie, is also a commodity currency, meaning that it often moves in step with the commodities markets—notably crude oil, precious metals, and minerals. With Canada being such a large exporter of such commodities, the loonie often reacts to movements in underlying commodities prices, especially that of crude oil. Also known as the Aussie, the Australian dollar is one of the major currencies of the Asia-Pacific region. The Aussie is considered one of the foremost commodity currencies, meaning that its value can be affected by price shifts in Australia’s major exports.

The Australian Dollar is the second most popular currency – accounting for 52% of trades.73AFXC, “Foreign Exchange Turnover Report”, accessed June 30, 2020. The most traded currency in the Australian FX market is the US dollar – which is found at either end of 93% of trades.72AFXC, “Foreign Exchange Turnover Report”, accessed June 30, 2020. The net average turnover of the UK foreign exchange market is $3,576 billion, or in other words, $3.576 trillion.61Bank of England, “BIS Triennial Survey of Foreign Exchange”, accessed June 30, 2020. The UK is the largest hub of the forex market, with a 43% share of the entire global turnover. In 2016, the UK’s share of the global turnover was 37%.60Bank of England, “BIS Triennial Survey of Foreign Exchange”, accessed June 30, 2020.

Most traded currency pairs on the forex market in 2020

Forex relates to buying and selling currencies with the purpose of making… The USD/NZD pair also accounts for 10% of the market’s turnover – with a slightly lower average trading volume which amounts to $13.546 billion.79AFXC, “Foreign Exchange Turnover Report”, accessed June 30, 2020. Great Britain has existed for centuries, but the pound sterling was introduced to the country in 1971. The currency is important because its value tends to be stable, which allows investors to have an easier time making decisions as there is little risk involved in trading. Countries around the world tend to hold the pound in high regard, and it is considered a safe reserve currency. While the Yen serves as the official currency of Japan, it is also Asia’s most traded currency.

What Does Popularity of Currency Pair Affect? First of all, actively traded pairs have high liquidity. When forex traders talk about the «strongest currency,» they usually mean that the currency has a high exchange rate with the U.S. dollar. Even though the U.S. dollar is the world’s reserve currency , some other currencies are «stronger.» The Kuwaiti dinar is the strongest currency, and $1 will buy you roughly 0.3 KWD. According to the International Monetary Fund, the U.S. dollar is the most popular. As of the fourth quarter of 2019, it makes up over 60% of all known central bank foreign exchange reserves.

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Likewise, forex can be as complex as investing in large businesses or depositing money in foreign bank accounts. The 1944 Bretton Woods agreement kickstarted the dollar into its current position. Before then, most countries were on the gold standard. Their governments promised to redeem their currencies for their value in gold upon demand.

The second-largest US broker is Oanda, with an average daily trading volume of $10.7 billion.27Wealth&Value, “Largest Forex Brokers in The World 2020”, accessed June 29, 2020. The largest US-based broker is Forex.com, which is owned by GAIN Capital Holdings inc. It has an average daily trading volume of $15.5 billion.26Wealth&Value, “Largest Forex Brokers in The World 2020”, accessed June 29, 2020. The foreign exchange market is the largest and most liquid market on Earth. We’ve compiled a list of important, up-to-date, actionable statistics regarding Forex trading so that you know what you’re getting into if you choose to trade Forex. In 1973, countries were given the option to peg their currency to other stronger currencies.