What Does Base Currency and Counter Currency Mean?

Base Currency and Counter Currency Price Meaning

Example of forex currency exchange rates quotes on MT4 Platform

Forex Currency Base and Forex Counter Currency Price Meaning Explained

Counter Currency is also known as Quote Currency

Forex Trading Currency Quotes Explained

In a Forex Currency Quote - The first currency in a forex currency pair is known as the base currency. The base currency in a currency quote is the currency against which exchange rate is quoted when a trader wants to buy this first currency using the second currency which is known as the quote currency.

For Example EUR USD - EURO is the base currency and US Dollar is the quote Currency

Base Currency: What is Base currency? Base currency is the first currency in a pair (EUR). The Base currency is equal to 1 unit of the first currency.

Counter Currency: What is Counter currency? Counter currency is the second currency in a pair (USD). The Counter currency shows the value of the base currency in relation to the second currency.

Counter Currency is also known as Quote Currency

Example of EUR USD Forex Trading Currency Quote - What is a Price Currency Quote?

EUR USD currency pair is one of the major forex currency pairs in Forex, therefore we shall use this EUR USD currency pair for our example:

EUR USD

• Base Currency - EUR

Base Currency is the first currency in a pair (EUR). The Base is equal to 1 unit of the currency base - first currency.

• Counter Currency - USD

Counter Currency is the second currency in a pair (USD). The Quote shows the value of the base currency base in relation to the Counter currency price - second currency.

If EUR USD currency exchange rate currency quote = 1.2000

It means the ratio of EUR : USD exchange rate = 1 : 1.2000

Therefore it means 1 Euro = 1.2000 US dollars

EUR USD - Base Currency and Counter Currency Example Explained

In this case The EUR is the base currency and USD is the counter currency.

The currency base is always 1 unit, and the exchange rate quote is in terms of the counter currency.

Therefore, if exchange rate of EUR USD = 1.2000, it means 1 Euro = 1.2 US dollars. So for every 1 Euro you have, you can buy 1.2 US dollars.