To understand the difference between the European vs US Forex trading markets it is essential that you first understand the difference between the currency. The euro and the US dollar (USD) are the two most common form of money in the world. These are the two currencies that are found in the reserves in many places around the globe. They are the two currencies that are part of the global economy.
The Euro – The European Union has 28 countries and 18 of these use the euro as their form of currency. This form of money was not in circulation until 1999 but has quickly been gaining in popularity and is expected to become the most used money in the world. Even though other countries still have their own currency, the euro is accepted in most places around the globe.
One thing that affects the euro that does not affect other types of currency is that since it is accepted in many countries, it can be affected by many different countries. This means that government decisions in more than one place can change the market value of the euro. This is very complicated and an issue that is going to need to be addressed as the euro continues to grow in popularity.
The USD – The USD remains the main form of money around the globe. It is accepted in more places than any other currency. There are currently 8 other countries that use the USD as their main currency. You must understand that the reason that the USD is used as the main currency in these countries is that their own money was no longer perceived as having any type of backing. Therefore their own money became worthless on the global market making it essential for them to find a currency that was going to allow them to trade with other countries.
Around the world, the USD remains the main currency that is found in reserves. Since the financial crisis of 2008 it has made a steady but slow decline in popularity. Many times when dealing with international business the USD is the preferred form of currency. The reason that it is so accepted is that it is known for being a stable currency.
Since the US has the largest economy it would be only natural that other powerhouse countries would adapt to using the USD for their transactions. This happens frequently in business including offshore Forex trading with Netotrade.
The main choice of determining whether a business transaction is down with the USD or the euro really breaks down to the overall stability. While the euro has not proven to be unstable by any means it also has not had the years of stability that the USD has. This means that in most cases the USD has such a large head start on the economy of the world that some doubt that the euro will ever be able to surpass it. Others believe that with faltering economic conditions that the USD is in threat of becoming meaningless in the coming years and that the euro will rise to be the number one currency in the world.
CNN shares up to date and current information about currencies. You can learn more about the value of the euro or the USD there. This is a great place to check before entering into any Forex relationships with either form of currency. You can learn which is going to be best for you.