Before we read any further, it is important for us to note that the forex market is 24 hours a day, 5 days a week and daily exchanges amount to approximately $3 trillion.

The forex market was established in the year 1971 and is featured by currency valuations at floating rates, which are determined by the forces of currency demand and supply besides other factors such as political, social, and economic. This worldwide market is signified by the presence of more than 500 trading institutions like individual and institutional consumers, businesses, investors, speculators, commercial banks, investment banks, central banks, and the major trading centers located in New York, Tokyo, London, Hong Kong, Singapore, Paris, and Frankfurt.

The foreign exchange market is open for currency trading from 20:15 GMT on Sunday until 22:00 GMT Friday. The top traders of this market are Deutsche Bank, USB AG, Barclays Capital, Citi, Royal Bank of Scotland, JPMorgan, HSBC, Credit Suisse, Goldman Sachs, and Morgan Stanley while the most traded currencies are the United States dollar, Euro, Japanese Yen, Pound Sterling, Australian dollar, Swiss franc, Canadian dollar, Hong Kong dollar, Swedish Krona, and New Zealand dollar.

It is worthwhile to note here that forex rates are influenced by many factors including government budget deficits or surpluses, inflation levels and trends, economic growth and health, international parity conditions, balance of payments model, asset market model, market psychology, international political conditions, and economic policy disseminated by government agencies and central banks.

We hope that this piece of information on forex market was useful to you for creating and maintaining a clear understanding about foreign exchange.