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Reading a currency pair quote

Forex Foundations

Base over quote

A pair like EUR/USD has a base currency, EUR, and a quote currency, USD. A quote of 1.0850 means one euro buys 1.0850 US dollars. The base currency is always worth exactly 1 unit in the quote.

Same logic, any two currencies

A quote of GBP/JPY at 189.50 means one British pound buys 189.50 Japanese yen. The math doesn't change, only which two currencies and which decimal convention are involved.

Buying means buying the base

Buying a pair means buying the base currency and simultaneously selling the quote currency. Selling the pair is the exact opposite: selling the base and buying the quote.

Check yourself

In the pair EUR/USD, the base currency is…

  1. EUR correct
  2. USD
  3. Neither, both are quote currencies

EUR sits first in the pair, making it the base currency the quote is expressed against.

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