Currency trading in India began back in 1978. Since then the forex market has grown and between 2024 to 2032, it is expected to grow at a CAGR of 9.2%. Factors such as the increase in cross-border forex trade and investment and forex risk management have led to this increase.
This makes currency trading a lucrative option. But with so many currency pairs being traded online, choosing the right one becomes tough. This article will walk you through all this and a lot more, so let’s begin.
Top 4 Major Currencies Traded in India
Currency Market Trading, also called forex trading, refers to the buying and selling of different currencies to gain from changes in their exchange rates.
Currency trading aims to anticipate and capitalize on changes in the values of currency pairs. You can trade currencies via derivatives.
Let us have a look at the 4 most traded currency pairs in currency trading attracting massive attention are as follows:
1. EUR/USD
The EUR/USD currency pair is also known as ‘fibre’. This pair represents the exchange rate between the Euro, the official currency of the Eurozone, and the US dollar, the primary global reserve currency. This currency became tradable in 1999.
The large trading volume and popularity of the pair is because it represents the world’s two strongest economies. Its high daily volume also ensures high liquidity, resulting in tight spreads. These tight spreads make it one of the one of the most currency trading among traders in India.
| Currency Pair | Conversion Rate (as of 1st Feb’24) |
| EUR/USD | 1.0849 |
2. USD/JPY
The USD/JPY currency pair signifies the rate at which the US dollar can be exchanged for the Japanese Yen. Also known as ‘Gopher’, it is the second most actively traded currency pair globally. It is one of the safest haven currency pairs because of Yen.
This is because of the lower rate of interest imposed by the Bank of Japan to combat deflation and the rising value during market upheaval.
Furthermore, the currency trading of USD/JPY is done in massive volume and thus witnesses low spreads and high liquidity, making it ideal for traders.
| Currency Pair | Conversion Rate (as of 1st Feb’24) |
| USD/JPY | 146.42 |
3. GBP/USD
The GBP-USD currency pair reflects the rate at which the British pound sterling can be traded for the US dollar. The GBP-USD currency pair is also known as the ‘cable’, as earlier cables were used to deliver bids and ask for quotes across the Atlantic Ocean.
The currency pair is one of the oldest currency pairs. With the close ties between the nations this currency trading is quite crucial.
| Currency Pair | Conversion Rate (as of 1st Feb’24) |
| GBP/USD | 1.2717 |
4. USD/INR
The USD/INR currency pair refers to the rate at which the US dollar can be exchanged for Indian Rupee. Economic conditions (employment, GDP growth), interest rates, political stability, and global market conditions impact the currency.
India is the US’ 9th biggest trading partner, and the close ties the two nations share in precious metals and stones, mineral fuels, and medicines trading make the USD/INR an attractive currency trading pair.
| Currency Pair | Conversion Rate (as of 1st Feb’24) |
| USD/INR | 83.04 |
Conclusion
The article has discussed the top 4 most highly traded currencies in the Indian forex exchange market. It further gives an overview of the nature of these currency pairs in detail.
However, you must keep in mind that currency trading has market risks, so ensure you do proper research and understand the market before investing in it. To start trading in currency derivatives, open free demat account with Dhan, India’s one of the best online trading platforms.
