A:

The British pound / U.S. dollar currency pair is one of the oldest and most widely-traded currency pairs in the world. The term cable is a slang term used by forex traders to refer to the exchange rate between the pound and dollar and is also used to simply refer to the British pound itself.

The term dates its origins to the 19th century. In the 1800s, the exchange rate between the U.S. dollar and British pound was transmitted across the Atlantic by a large cable that ran across the ocean floor between the two countries. Since that time the exchange rate has been referred to as the cable.

To learn more, read Forex Currencies: The GBP/USD.

This question was answered by Lovey Grewal.

RELATED FAQS
  1. How can I trade in cross currency pairs if my forex account is denominated in U.S. ...

    The forex market allows individuals to trade on nearly all of the currencies in the world. However, most of the trading is ... Read Answer >>
  2. In forex, what are the commodity pairs?

    In forex, the commodity pairs consist of the heavily-traded currency pairs and contain the Canadian, Australian and New Zealand ... Read Answer >>
  3. What am I buying and selling in the forex market?

    The forex market is the largest market in the world. According to the Triennial Central Bank Survey conducted by the Bank ... Read Answer >>
  4. Why isn't the EUR/USD currency pair quoted as USD/EUR?

    In a currency pair, the first currency is called the base currency and the second is the quote currency, a longtime convention ... Read Answer >>
  5. What is the value of one pip, and why are pips different between currency pairs?

    Pips relate to the smallest price moves of foreign exchange rates. This differs from currency pairs such as EUR/USD, which ... Read Answer >>
  6. What is hedging as it relates to forex trading?

    A currency trader enters a forex hedge to protect an existing or anticipated position from an unwanted move in the foreign ... Read Answer >>
Related Articles
  1. Trading

    The British Pound: What Every Forex Trader Needs To Know

    As a strong alternative to the dollar it is likely that the pound will remain a preeminent global currency for some time to come.
  2. Trading

    Popular Forex Currencies

    Learn about the most traded currencies and the strategies used to trade them.
  3. Trading

    Forex: Identifying Trending And Range-Bound Currencies

    Gain a trading edge by learning how macroeconomic forces play out differently for various pairs in the forex market.
  4. Trading

    Currency All-Time Highs And Lows

    These four major currencies have seen some wild swings in the floating market since 1990.
  5. Trading

    Strategies for part-time forex traders

    Learn strategies for part-time forex traders to profit even with an inconsistent trading schedule. Find the information you need today!
RELATED TERMS
  1. Cable

    Cable is a term used among forex traders referring to the exchange ...
  2. GBP/USD (British Pound/U.S. Dollar)

    The abbreviation for the British pound and U.S. dollar (GBP/USD) ...
  3. Major Pairs

    Major pairs are the most traded foreign exchange currency pairs. ...
  4. Currency Pair

    A currency pair is the quotation of one currency against the ...
  5. Currency Pairs

    Currency Pairs are two currencies with exchange rates that are ...
  6. Reciprocal Currency

    In the foreign exchange market, a currency pair that involves ...
Hot Definitions
  1. Gross Margin

    A company's total sales revenue minus its cost of goods sold, divided by the total sales revenue, expressed as a percentage. ...
  2. Inflation

    Inflation is the rate at which prices for goods and services is rising and the worth of currency is dropping.
  3. Discount Rate

    Discount rate is the interest rate charged to commercial banks and other depository institutions for loans received from ...
  4. Economies of Scale

    Economies of scale refer to reduced costs per unit that arise from increased total output of a product. For example, a larger ...
  5. Quick Ratio

    The quick ratio measures a company’s ability to meet its short-term obligations with its most liquid assets.
  6. Leverage

    Leverage results from using borrowed capital as a source of funding when investing to expand the firm's asset base and generate ...
Trading Center