Most Volatile Currency pairs

The most volatile currency pairs are the currencies which are closely correlated to the price of specific commodities and the currencies of emerging countries.

The most volatile currency pairs are listed below:

Diverse CurrenciesCommodity Related
Czech Koruna (CZK)Australian Dollar (AUD)
Hungarian Forint (HUF)Canadian Dollar (CAD)
Polish Zloty (PLN)New Zealand Dollar (NZD)
Turkish Lira (TRY)Russian Rubble (RUB)
Indonesian Rupiah (IDR)Norwegian Krone (NOK)
Malaysian Ringgit (MYR)South African Rand (ZAR)
Thai Baht (BHT)Brazilian Real (BRL)
 Mexican Peso (MXN
 Peruvian New Sol (PEN)

The currencies of certain emerging markets are highly volatile because they depend on global capital fund flows. During global economic growth periods, capital flows from developed countries like the United States and Europe towards emerging market economies like Turkey, Brazil and Mexico looking for higher rates of return. This causes their currencies to appreciate. During global economic recessions however, capital flows out of these countries into safe-haven countries like the United States looking for safety. This causes these commodities to depreciate substantially causing extreme volatility.

Commodity prices are highly volatile and depend on global economic growth. During global economic expansions commodity prices rise whereas during recessions commodity prices fall substantially. The volatility of commodity prices affects the currencies of countries which are producers and exporters of the specific commodities.

Crude Oil related Currencies

The Russian Rubble (RUB), Norwegian Krona (NOK), Canadian dollar (CAD), Mexican peso (MXN), Brazilian Real (BRL) are closely correlated with the price of crude oil.

Metals related Currencies

The Australian Dollar (AUD) is dependent on industrial metals because Australia is a major metal exporter mainly to China. The Chilean Peso (PEN) is closely correlated with the spot price of copper since Chile is the main world exporter of copper. The South African Rand (ZAR) is closely correlated with the spot price of gold and platinum since South Africa is major producer and exporter of Gold and Platinum.

Other Commodity related currencies

The New Zealand Dollar is correlated with the price of agricultural products.

To learn more about how to trade these currencies visit our free Forex Trading guide.

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