Major currency pairs are the most traded forex pairs in the world — each one always includes the US dollar (USD) on one side. Most Australian CFD and forex brokers list majors as their primary markets because they offer the tightest spreads and the highest trading volume of any currency combination.
How Major Currency Pairs Work — A Practical Example
The seven recognised major pairs are EUR/USD, USD/JPY, GBP/USD, USD/CHF, AUD/USD, USD/CAD, and NZD/USD. As an Australian trader, AUD/USD is likely the first major you will encounter — it tells you how many US dollars one Australian dollar buys.
Say AUD/USD is quoted at 0.6500. You open a standard lot position (100,000 units) on a platform like Pepperstone. Your notional exposure is A$153,846 (or approximately USD 100,000). If the price moves up by 50 pips to 0.6550, that move is worth roughly USD 500 — about A$769 at current rates. Because you are trading with leverage, you only need to post a fraction of that as margin to hold the position.
Major pairs typically have spreads as low as 0.0 to 1.0 pip on ECN accounts, compared with 5–20 pips on exotic pairs. That difference adds up quickly when you are placing multiple trades per week.
Why Major Currency Pairs Matter for Australian Traders
ASIC caps leverage at 30:1 for major currency pairs for retail clients, under its product intervention orders introduced in 2021. For minor and exotic pairs the cap drops to 20:1, and for some assets even lower. This means majors give Australian retail traders the highest permitted leverage of any forex product — worth understanding before you choose which market to trade.
Because majors are so liquid, bid-ask spreads are consistently tighter, and order fills are faster with less slippage. During the Sydney and London overlap (roughly 5 pm–7 pm AEST), pairs like EUR/USD and GBP/USD see their highest daily volume, which is when spreads are often at their narrowest for Australian traders working normal business hours.
A broker that handles majors well will offer raw or near-raw spreads, fast execution, and transparent commission disclosure. A broker that pads spreads on majors — even slightly — can quietly erode your profitability over dozens of trades. Always check whether the advertised spread is typical or only a minimum.
Major Currency Pairs vs Minor Currency Pairs
Minor pairs (also called cross pairs) combine two major currencies but leave out the USD — examples include EUR/GBP, AUD/JPY, and GBP/JPY. They still have solid liquidity but generally carry wider spreads and lower daily volume than true majors. Exotic pairs go further, pairing a major currency with a currency from an emerging economy such as the USD/THB or AUD/ZAR — these come with much wider spreads and greater volatility. For most Australian traders, major pairs are the more important factor to check when comparing broker pricing, because they form the core of most retail forex strategies.
What to Check When Comparing Brokers
- Spread type and typical value: Look for brokers that publish live or average spreads on majors, not just minimum spreads. A broker quoting 0.0 pip raw spread plus a A$3–A$7 per-side commission is often cheaper overall than one quoting a 1.2 pip no-commission spread.
- Leverage offered on major pairs: Under ASIC rules, AFSL-licensed brokers are capped at 30:1 on majors for retail accounts. Be cautious of offshore brokers advertising 500:1 — they are not covered by the same protections.
- Execution speed and slippage policy: Major pairs move fast during news events. Check whether the broker uses a dealing desk or operates as an ECN/STP — IC Markets and Pepperstone are two ASIC-licensed ECN brokers well regarded for low-slippage execution on majors.
- Number of major pairs listed: All seven recognised majors should be available. Some platforms restrict pairs or offer poor pricing on AUD/USD and NZD/USD — pairs that Australian traders follow most closely.
- Overnight swap rates: If you hold major pair positions overnight, swap charges apply. Compare these across brokers, as they vary significantly and are often overlooked when calculating total trading cost.
See our picks for the best forex brokers in Australia — all ASIC-licensed, all live-tested by our team.
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