What is a Currency?

Currency refers to a monetary unit that is the principle method of exchange of goods and services used by a country. Most countries have their own currency. In the Forex markets, each currency is given a three letter code in English. The following is a list of some of the World's most traded currencies:

EUR	The Euro - The official currency unit for the European Union. Includes the following 13 countries: Austria, Belgium, Finland France, Germany, Greece, Ireland, Italy, Luxembourg, The Netherlands, Portugal, Slovenia and Spain.
USD	The United States Dollar
JPY	The Japanese Yen
GBP	The Great British Pound, also known as the Sterling
CHF	The Swiss Franc
AUD	The Australian Dollar
CAD	The Canadian Dollar
DKK	The Danish Krone
HKD	The Hong Kong Dollar
HUK	The Hungarian Forint
MXN	The Mexican Peso
NOK	The Norwegian Krone
NZD	The New Zealand Dollar
PLN	The Polish Zloty
SEK	The Swedish Krone
SGD	The Singapore Dollar
TRY	The Turkish Lira
ZAR	The South African Rand

The first seven currencies listed (EUR, USD, JPY, GBP, CHF, AUD and CAD) are known as the majors. They represent an overwhelming percentage of all the total trades in foreign exchange. It is said that approximately 90% of all trades involves the USD as one of the currency pairs.

Other local currencies include:

BHD	The Bahraini Dinar
CYP	The Cyprus Pound
INR	The Indian Rupee
JOD	The Jordanian Dinar
KWD	The Kuwaiti Dinar
LBP	The Lebanese Pound
LKR	The Sri Lanka Rupee
OMR	The Omani Riyal
PKR	The Pakistan Rupee
QAR	The Qatar Riyal
SAR	The Saudi Arabia Riyal
THB	The Thai Baht

Not all currencies are allowed to be fully floated by their governments, and hence real FX trading is really performed against those currencies that have a full floating exchange rate mechanism – this means that the market determines the strength or weakness of a currency without or with minimum government intervention.