Sovereign currencies, which are national currencies that are held either at the central bank or at payment institutions where deposits are 100% backed by central bank reserves, are as diverse in their value and purpose as the nations which issue them.
Perhaps over the past few years, the differential in value between the most commonly used currencies in the world has been in the public spotlight more than usual, largely because, like any financial instrument, the most used and most commonly traded currencies are often the least volatile.
For almost three decades, the currency markets have been considered to be very stagnant, giving rise to an overall notion that the 'major' currencies – those in which most of the world's foreign transactions are denominated – had not varied in value that much against each other.
Suddenly, in 2020, things changed.
The 'major currencies' are associated with developed regions of the world in which large financial centres exist and in which a long-standing, diversified industry base has contributed to a modern and comfortable way of life with low levels of corruption and a strong set of banking and financial market regulations.
These currencies are the British Pound, the US Dollar, the Euro, the Japanese Yen, the Swiss Franc, the New Zealand Dollar, the Canadian Dollar and the Australian Dollar.
Since 2020, when national governments instigated lockdowns against businesses and private individuals, global economics have been very different. Volatility suddenly returned to the major currencies, and the overall stability of their issuers came under the spotlight, however, volatility among other currencies which are not part of the major currency list has been very much noticeable for many decades.
These non-major currencies are called 'exotic' currencies and often are the sovereign currencies of either nation with emerging markets economies or of nations with undeveloped economies and no standing at all on the global financial and industrial world stage.
Perhaps over the past few years, the differential in value between the most commonly used currencies in the world has been in the public spotlight more than usual, largely because, like any financial instrument, the most used and most commonly traded currencies are often the least volatile.
For almost three decades, the currency markets have been considered to be very stagnant, giving rise to an overall notion that the 'major' currencies – those in which most of the world's foreign transactions are denominated – had not varied in value that much against each other.
Suddenly, in 2020, things changed.
The 'major currencies' are associated with developed regions of the world in which large financial centres exist and in which a long-standing, diversified industry base has contributed to a modern and comfortable way of life with low levels of corruption and a strong set of banking and financial market regulations.
These currencies are the British Pound, the US Dollar, the Euro, the Japanese Yen, the Swiss Franc, the New Zealand Dollar, the Canadian Dollar and the Australian Dollar.
Since 2020, when national governments instigated lockdowns against businesses and private individuals, global economics have been very different. Volatility suddenly returned to the major currencies, and the overall stability of their issuers came under the spotlight, however, volatility among other currencies which are not part of the major currency list has been very much noticeable for many decades.
These non-major currencies are called 'exotic' currencies and often are the sovereign currencies of either nation with emerging markets economies or of nations with undeveloped economies and no standing at all on the global financial and industrial world stage.
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and the rest of the list goes on.
