Forex Cross Currency Pairs: What They Are and How to Trade Them

A cross currency pair, or simply a cross, is a forex pair that does not include the US dollar. EUR/GBP, EUR/JPY, GBP/JPY, AUD/JPY and AUD/NZD are all crosses. They let you trade one non-dollar economy against another directly, instead of going through the dollar.

The BIS Triennial Survey 2025 found the US dollar on one side of 89.2% of all foreign exchange trades, which leaves about 10.8% of global turnover in pairs with no dollar at all. That smaller slice is where crosses live.

If you are new to how pairs are written, start with how forex quotes work and the seven major currency pairs. This lesson builds on both.

What makes a pair a cross

Forex pairs are usually sorted into three groups. Majors pair the US dollar with one of the other big, freely traded currencies. Crosses pair two of those big currencies with each other and leave the dollar out. Exotics pair a major currency with the currency of a smaller or emerging economy.

The name goes back to how these rates were once priced. Banks quoted most currencies against the dollar, so a euro-to-yen rate was worked out by crossing two dollar rates. Today crosses trade directly on electronic platforms, but the maths still ties them to the dollar pairs, and that link matters for anyone who trades both.

Traders also group crosses by the currency they contain. Euro crosses include EUR/GBP, EUR/JPY, EUR/CHF and EUR/AUD. Yen crosses include EUR/JPY, GBP/JPY, AUD/JPY and CAD/JPY. Pound crosses include EUR/GBP, GBP/JPY and GBP/CHF. Each family tends to react to the news of its shared currency.

How a cross rate is calculated

A cross rate is the product, or the ratio, of two dollar rates. If one euro buys 1.0850 dollars and one dollar buys 150 yen, then one euro buys 1.0850 × 150 = 162.75 yen. The dollar appears in both pairs and cancels out.

When both dollar pairs quote the dollar second, you divide instead. With EUR/USD at 1.0850 and GBP/USD at 1.2700, EUR/GBP is 1.0850 ÷ 1.2700 = 0.8543. One euro buys about 0.854 pounds.

This link keeps the markets honest. If EUR/JPY drifted away from EUR/USD × USD/JPY, banks and trading firms would buy the cheap side and sell the dear side until the gap closed. As a retail trader you never need to do this arithmetic to place a trade, because the platform quotes the cross directly. It helps you see why a cross moves, though.

Why cross pairs move

A cross moves when its two currencies move differently against the dollar. Suppose the dollar weakens across the board after a soft US jobs report. EUR/USD rises and USD/JPY falls, and the two moves can roughly cancel in EUR/JPY. A cross can sit still on a day when every dollar pair is flying.

That is the main appeal. A cross isolates the relationship between two economies. EUR/GBP reflects the gap between euro-area and UK news: interest rate decisions from the European Central Bank and the Bank of England, inflation, growth and politics on each side. US data has far less direct effect on it.

• Interest rate gaps. A widening gap between two central banks' rates tends to support the higher-yielding currency. Our economic calendar lists the meeting dates.
• Risk mood. Yen crosses such as AUD/JPY often fall when investors turn cautious, because the yen has traditionally been bought in stressed markets and the Australian dollar sold.
• Commodities. AUD, NZD and CAD crosses respond to metal, dairy and oil prices. CAD/JPY often tracks oil.
• Regional news. A UK budget or a euro-area election moves EUR/GBP far more than any US release.

Costs: spreads, swaps and pip values

Crosses usually cost more to trade than EUR/USD. They see less turnover than the dollar majors, and the BIS figures above explain why: most of the market's volume runs through the dollar. EUR/GBP and EUR/JPY are among the most liquid crosses, while pairs like GBP/NZD or EUR/NZD carry wider spreads at most brokers. Compare the typical spread for each pair on your broker's own contract page, and use our trading cost calculator to turn it into money.

Pip value on a cross

A pip is always measured in the quote currency, the second one in the pair. On EUR/GBP a one-pip move on one standard lot (100,000 euros) is worth £10. EUR/JPY uses a pip of 0.01, so the same move is worth ¥1,000. Your account then converts that into your own currency at the going rate.

This is the most common sizing mistake on crosses. A trader used to $10 a pip on EUR/USD who switches to EUR/GBP risks about 27% more per pip without noticing. Run every cross through the pip calculator or our position sizing guide before trading it.

Overnight swaps on crosses depend on the interest rates of both currencies, just as on any pair. A cross between a high-rate and a low-rate currency can pay or charge noticeably more per night than a major. Check the swap long and swap short figures in the platform before holding a cross for weeks.

Leverage: some crosses count as majors

Here is a detail many traders miss. Under the FCA rules, a "major foreign exchange pair" is any pair made of two of these six currencies: the US dollar, euro, Japanese yen, pound sterling, Canadian dollar and Swiss franc. Retail clients can use up to 30:1 on those pairs and 20:1 on every other currency pair. The EU applies the same caps.

So in the UK and EU, EUR/GBP, EUR/JPY, GBP/JPY, EUR/CHF and CAD/JPY are majors for leverage purposes, even though traders call them crosses. AUD/USD and NZD/USD, which most people call majors, are limited to 20:1, and so are AUD/JPY, AUD/NZD and every other Australian or New Zealand dollar pair. Brokers in other regions set their own limits; our leverage limits by country page compares them.

Crosses and hidden double exposure

Because a cross is two dollar pairs combined, you can build one by accident. Buying EUR/USD and buying USD/JPY at the same size is very close to buying EUR/JPY: the dollar legs cancel and you are left long euro, short yen. A trader who holds EUR/USD, USD/JPY and EUR/JPY together may think the risk is spread over three trades when most of it is one bet.

The opposite also happens. Long EUR/USD plus short GBP/USD is roughly long EUR/GBP. If your plan was a view on the dollar, the combined position has almost no dollar exposure left. Our forex correlation matrix shows how closely pairs move together, and the lesson on currency pair correlation explains how to count related trades as one risk.

When a cross is the better trade

A cross makes sense when your idea is about two non-dollar currencies, not about the dollar. Three common cases:

1. Diverging central banks. The Bank of England is raising rates while the ECB is holding. EUR/GBP expresses that view directly, without a US jobs report knocking the trade around.
2. Risk-on and risk-off. Traders who read the global mood often use AUD/JPY, because the two currencies tend to react in opposite directions when markets turn.
3. Avoiding a crowded dollar. When the dollar is the only thing moving and you have no view on it, a cross lets you trade something with its own story.

Session timing matters too. EUR/GBP is most active during London hours, when both currencies' home markets are open. AUD/JPY and AUD/NZD see more activity in the Asian session. Our forex market hours tool shows which centres are open at any moment.

Common mistakes with crosses

• Sizing a cross as if a pip were worth $10, when it is often more or less.
• Ignoring the wider spread, which matters most for short-term and scalping strategies.
• Holding a cross for weeks without checking the swap, which can add up on high-rate gaps.
• Stacking a cross on top of the two dollar pairs that make it up, doubling the same bet.
• Trading thin crosses such as GBP/NZD during quiet hours, when spreads widen further.

Frequently asked

Related reading

• Major currency pairs
• Exotic currency pairs
• Forex correlation matrix