One of the most popular currency pairs is GBP/USD, and it is also one of the longest running exchanges in the history of forex trading. We meticulously study its daily fluctuations, but let’s look at 13 key things you likely don’t know about it.
In early 1985, pound sterling reached its lowest rate at $1.05.
Throughout various times in history, these 2 currencies have been the de facto reserve currency. Prior to the outbreak of WWI, pound sterling dominated the global finance with more than 70% of the world government debt denominated in GBP. By the 1920s, the US dollar had caught up with the pound, and in the 1940s, it overtook sterling as the British economy declined.
Traders call the GBP/USD pair “cable,” referring to the submarine telegraph cable that has been placed between Great Britain and the USA in the 1800s. Signals were first sent to and from London and New York in 1866, carrying the most current pound sterling to dollar exchange rates. In 1886, The Times, a London-based newspaper, began publishing the daily exchange rates.
On November, 6, 1980 the GBP climbed to $2.466 − its highest level against the USD.
On February 2, 2008 the GBP crashed back to $1.426.
From 1940 – 1971, the price of the pound was fixed to that of the US Dollar. In 1971, President Nixon pulled the USA out of the Bretton Woods system, and free-floating Forex exchange returned to the markets.
After the war, the global money supply dramatically increased. In 1960, there were $177.41 for every person in the USA, and by 1990 − $1,062.86.
In the run-up to the financial crisis, the pound broke through the $2 mark and hit $2.11 on November 7, 2007.
Pound sterling is the oldest currency still used today, originating in Anglo-Saxon England, with one pound weight of silver equivalent to 240 silver pennies.
The GBP/USD has high volatility, and this is what makes it one of the most popular pairs with FX traders. With lower liquidity, compared to other majors, this pair can have larger fluctuations following political and economic events.
There are £10,000, £5,000, £1,000, and £500 bills in circulation today, while the largest bill still being printed today is the $100. Alsoб there is the £100,000 Gold Certificate used for Federal Reserve Bank transactions.
King Henry I castrated 94 coin makers in 1124 because he was trying to instill confidence in the pound sterling, after low-quality currency has been produced.
The estimate is that £1 in every £12,500 is counterfeit. That makes more than £70m worth of the currency fake.
Can you add more facts to this list? Don’t hesitate to do so in the comments below and check out more articles about how you can make big moves with currency pairs and the six common currency markets.