Learn / Currencies & FX
Currencies & FX
The foreign-exchange market: pairs and pips, central banks, pegs and regimes, and what moves exchange rates.
Foundations
The Forex Market: The Complete Guide
The foreign exchange (forex) market is the largest financial market in the world, where currencies are bought and sold in pairs around the clock… · 7 min read
Currency Pairs: Base, Quote and What EURUSD Means
A currency pair shows how much of one currency it takes to buy another. In any pair, the currency listed first is the base currency and the currency… · 5 min read
Pips, Spreads and Reading an FX Quote
An FX quote shows two prices — the bid (what a dealer buys at) and the ask (what they sell at) — and the tiny gap between them, called the spread, is… · 6 min read
Drivers
What Moves Exchange Rates?
Exchange rates move because of five main forces: interest-rate differences between countries, inflation gaps, trade and current-account balances… · 5 min read
Central Banks and Currencies
Central banks move currency values through three main tools: interest-rate decisions, quantitative easing or tightening, and direct intervention in… · 6 min read
The US Dollar Index (DXY)
The US Dollar Index, known by its ticker DXY, measures the value of the US dollar against a basket of six major currencies, with the euro making up… · 6 min read
Safe-Haven Currencies: Dollar, Yen and Franc
Safe-haven currencies are currencies that traders historically seek out during periods of global stress because they are seen as reliable stores of… · 6 min read
Regimes
Emerging-Market Currencies
Emerging-market currencies are the money of developing economies — think the Brazilian real, Turkish lira, South African rand, or Indian rupee. They… · 6 min read
The Carry Trade, Explained
The carry trade is a strategy where traders borrow money in a low-interest-rate currency, convert it into a higher-interest-rate currency, and earn… · 6 min read
Currency Pegs, Regimes and Crises
A currency regime is the set of rules a government or central bank uses to manage its exchange rate — from a completely free float to a hard peg… · 8 min read