The Importance Of The Dollar On The Forex Market
Despite the variety of financial instruments in the Forex market and, in particular, a large number of currency pairs, the highest profit potential among them contain one assets directly associated with the US dollar as it is the basis of all world trade. The fact that the US dollar is the currency that affects with all the currency pairs at Forex. This is the only currency in the world that has such a tremendous value. It is the base currency for the majority of currency pairs. Despite the fact that the Euro has tried to compete with the dollar in the market, and more than fifty countries in Europe have abandoned their currency in order to create a single, strong competitive power of currencies, however, the Euro was unable to dislodge the dollar from its unique position.
All transactions in the Forex market are still calculated only in US dollars. This is due not only to the power of the United States. As happened historically, ever since when every dollar was guaranteed by the government of the United States in gold and even after abandoning the gold guarantee for every dollar, its importance in the international financial Forex market has not diminished.
In addition the United States of America did not experience political crisis since the Civil War. Because of the US policy of limited risk in comparison with other countries, this country is a safer place for capital investment, and dollars are accepted for payment all over the world. The United States economy is the largest in the world. According to statistics, American companies account for about 18% of all goods and services produced in the world. This helps to strengthen the power of the dollar on the Forex market, as have the dollars to do business in the world’s largest economy, is essential.