With over $1.2 trillion traded daily on EUR-USD or Euro Dollar, spread betting the currency pair allows you to trade the largest single financial market on the planet. Other major currency pairs include EUR-GBP and GBP-USD.
|Dealing hours||Sunday 22:05 to Friday 22:00|
|Exchange hours||24 Hours (trading break 22:00-22:05)|
|GTD minimum distance||1.50%|
|Bet type||Daily funded bet|
Details are indicative and are subject to change, clients should confirm spread
bet details in our platform before trading.
The EUR/USD currency pairing, or Eurodollar, is one of the most frequently traded in the world and is one of the "Majors". As with all pairings, its rates continually fluctuate, as shown by historical EUR/USD data, and this affects its day-to-day popularity. As it includes the currencies of two of the world's most dominant economic powers, though, it's a favourite with forex traders and a popular spread betting instrument.
Not to be confused with Eurodollar futures trading, which involves the trading of US-dollar denomination time deposits in overseas banks, Eurodollar currency trading involves buying and selling Euros for US dollars on the foreign exchange markets. Eurodollar spread betting involves speculating on the market movements of these currencies in relation to each other.
So how much do you know about the Eurodollar? Here are five key facts about this FX currency pair.
The EUR/USD pairing entered the financial markets in 1999, following the introduction of the Euro as the single currency to be used by the Eurozone countries. Whilst the currency didn't become widely circulated for several years, trading began to take place before this. However, early EUR/USD rates were low, with the pair opening at 1.1795 and dropping.
The Eurodollar's nickname isn't used as much as those of the other main currency pairings and its origins aren't entirely clear. Some people believe that it's an updated version of the nickname used for the GBP/USD pairing, 'cable', and refers to a more contemporary method of data transfer, whilst other believe that it's a reference to the hardwearing cotton fibre used to make Euro banknotes.
These factors make this pairing a particularly attractive spread betting or trading instrument. Its liquidity means that traders can enter and exit the market quickly, whilst its volatility means that there is the potential for traders and spread betters to make substantial profits – although, of course, this also means that they could make large losses.
The volatility of the EUR/USD pairing is partly due to the number of economic factors that can affect it. As the Euro is a multi-nation currency, significant events in any of the countries that use it, such as political changes or employment statistic changes, can have an effect on its strength. Other factors that can affect the pairing include economic issues in the USA, and the interest rates in both the USA and the Eurozone.
The Euro reached 1.6040 against the dollar in July 2008. The subprime mortgage crisis in the United States had led to serious concerns about the health of the American economy and state of the banking system at the time, weakening the dollar.
On 25 October 2000, the Euro fell to its all-time lowest rate against the dollar, closing at 0.8272. Rumours that a European bank was about to make an acquisition in America and, therefore, trading large quantities of Euros for dollars had begun to circulate on the trading floors. The dollar, simultaneously, was particularly strong, with the pound and the Swiss Franc also having fallen sharply against it that day.
In March 2015, the Euro hit a 12 year low against the dollar, after the European Central Bank embarked upon a programme of quantitative easing.