Meet the majors
Six Major Pairs. Six Global Relationships.
Major Forex pairs combine the US dollar with another widely traded global currency. They sit at the centre of the foreign exchange market and respond as economic expectations, rates and monetary policies change.
Every pair tells a story about the relationship between two economies and two currencies.
EUR/USD
Euro / US Dollar
Eurozone + United States
European Central Bank + Federal Reserve
Responds to differences in rates, inflation, growth and monetary policy.
GBP/USD
British Pound / US Dollar
United Kingdom + United States
Bank of England + Federal Reserve
UK and US inflation, employment, growth and policy expectations can influence it.
USD/JPY
US Dollar / Japanese Yen
United States + Japan
Federal Reserve + Bank of Japan
Rate differences and changing policy expectations can play an important role.
USD/CHF
US Dollar / Swiss Franc
United States + Switzerland
Federal Reserve + Swiss National Bank
Responds to policy, economic expectations, currency demand and sentiment.
AUD/USD
Australian Dollar / US Dollar
Australia + United States
Reserve Bank of Australia + Federal Reserve
Influenced by rates, activity, commodities and Australia’s trading relationships.
USD/CAD
US Dollar / Canadian Dollar
United States + Canada
Federal Reserve + Bank of Canada
Responds to policy, economic data, trade and energy-market developments.
Read a Forex pair in seconds
Base Currency and Quote Currency
Take EUR/USD as an example. EUR is the base currency and USD is the quote currency. If EUR/USD is quoted at 1.1000, one euro is valued at 1.10 US dollars.
When EUR/USD Rises
The euro is strengthening relative to the dollar, or the dollar is weakening relative to the euro, based on the pair’s movement.
When EUR/USD Falls
The euro is weakening relative to the dollar, or the dollar is strengthening relative to the euro, based on the pair’s movement.
The same base-and-quote relationship applies when reading other Forex pairs.
Two currencies. Two economies. One price.
Both Sides of Every Pair Matter
A major Forex pair is influenced by developments on both sides of the pair. For EUR/USD, a change in US rate expectations can move the pair even when European conditions remain relatively unchanged.
- EUR/USD: Eurozone ↔ United States
- GBP/USD: United Kingdom ↔ United States
- USD/JPY: United States ↔ Japan
- USD/CHF: United States ↔ Switzerland
- AUD/USD: Australia ↔ United States
- USD/CAD: United States ↔ Canada
Understanding the relationship between the two economies provides important context for currency movements.
The central banks behind the majors
Seven Institutions Shaping Expectations
Federal Reserve · USD
Its decisions influence every major pair containing the dollar. Rates, statements and future-policy expectations are closely followed.
European Central Bank · EUR
ECB policy influences the euro through rates, inflation expectations and Eurozone conditions.
Bank of England · GBP
Policy decisions affect sterling through rates and expectations about the UK economy.
Bank of Japan · JPY
Japanese monetary policy can significantly influence the yen, especially when conditions differ from other economies.
Swiss National Bank · CHF
Swiss monetary policy and currency conditions influence the franc and related pairs.
Reserve Bank of Australia · AUD
Australian rates and monetary-policy expectations influence the Australian dollar.
Bank of Canada · CAD
Canadian policy, economic conditions and rate expectations influence the Canadian dollar.
What moves the major pairs?
Economic and Policy Drivers
Interest Rate Expectations
Differences between two economies can influence relative currency demand.
Inflation
Reports can change expectations about future policy and interest rates.
Employment
Labour-market information shapes expectations about strength and policy.
Economic Growth
GDP and other indicators can affect views of an economy and its currency.
Central Bank Communication
Statements, speeches and guidance can change expectations without a rate change.
Global Market Sentiment
Confidence, uncertainty and risk attitudes can influence currency demand.
Economic Releases the Forex Market Watches
Inflation Reports
Consumer-price information can affect rate expectations.
Employment Data
Offers insight into labour conditions and economic activity.
GDP
Measures economic output and the direction of an economy.
Interest Rate Decisions
Can directly change or reinforce policy expectations.
Central Bank Statements
Show how policymakers view inflation, growth and future policy.
Market reactions depend not only on published figures but also on how those figures compare with expectations.
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Activity Across Financial Centres
Sydney
The global trading day begins across the Asia-Pacific region.
Tokyo
Activity increases across Japanese yen and other Asia-Pacific markets.
London
A major period of activity across European currencies and global Forex.
New York
US and Canadian currencies become active as North American markets respond to developments.
Session overlaps can experience increased participation and liquidity. Conditions still vary by pair, economic calendar and market environment.
Different Pairs. Different Drivers.
- EUR/USD: Eurozone and US monetary policy
- GBP/USD: UK and US economic and policy expectations
- USD/JPY: US–Japan interest-rate differences
- AUD/USD: Australia, commodities and Asia-Pacific developments
- USD/CAD: Canadian conditions and global energy markets
- USD/CHF: Swiss conditions and global sentiment
Major Forex pairs with CFD First
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