Glossary Term

Base Currency

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The base currency in any currency pair is simply the first currency that is quoted in the pair. Exchange rate quotes are presented as two currency (ISO) codes often divided by a forward slash, for example, EUR/GBP. The first currency in the pair is known as the base currency. This is the currency you’re buying or selling when trading the pair (the euro in this example). The second is the quote currency, which tells you the value of the base currency about another national currency (the British pound in the above example). So, if the exchange rate for EUR/GBP is currently 0.90, this means that 1 euro buys you 0.90 pence in GBP.

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