Posts Tagged ‘ euro ’

The article will highlight you on the top 5 ruling currencies of the world.

US Dollar

The dollar stands as the top most currency of the world, with the US Federal Reserve System (central bank of US) controlling all dollar rates, dollar policies and dollar dealings in open international Markets. Like any other currency Dollar sees its support through economic policies like GDP, the industrial set up and employment lookout. Announcements made for interest rate policy. The dollar is currently in a fierce competition with the Euro and the Yen, but it still holds a top position.

Euro Currency

The European Central Bank is Europe’s largest bank with operations reaching out to 15 countries worldwide. The ECB, with its main body, an Executive Council and a president, is responsible for making and executing monetary policy. There are 4 main seats, representing the four major economical countries out of the 15, operational under the ECB. ECB’s main attention is towards gaining a balance in price and money value, rather than focusing on employment and long term interest rates.

Japanese Yen

The Bank of Japan is the central bank of the third largest economy of the world. Monetary policy is governed by the bank along with issuance of currency, open market operations and controlling the economic conditions.

The Japanese Yen trades as a carry trade component. Though the Yen is the third highest paying currency, it still has an interest rate lower than that of the NewZealand, Australian and British currency, because of a fierce competition between the four. Because of all this competition, traders aim on only investments that give a long term benefit. The average daily pips come in the range of 30-40 and reach as high as 150 in extreme conditions.

British Pound:

The Bank of England is the dominant force over the Pound as it controls economic rates, currency rates and price stability. The pound can be considered more volatile than Euro and trades on a wider range. Average pips are 100 150, with the range going down to 20 on critical days.Whenever there is any trading in other currencies it affects the pound greatly.

Swiss Franc:

The Swiss National Bank is a multiple public and private ownership with a tiny governing body. The interest rate is decided between plus and minus 25 basis points. The Swiss franc does not much of a swing and has around 35 pips on average. It is only during the London sessions, that one notices a high frequency change.

New Zealand Dollar

The Reserve bank of Australia and the Reserve Bank of New Zealand control this currency, with their collaborative operations. The main goal of the two banks is to work towards price stability and reduction of inflation to atleast 3%.Both the currencies give the highest yield among the top currencies on most trading platforms which make them particularly volatile . Average pips is 30-40 per day.