Currency markets are used by both speculators and hedgers. Speculators watch global economic activity to play the markets, while hedgers use currency contracts to hedge against foreign exchange risk. Currency, itself, is legally specified by a government to be used as the basis of national trade, usually consisting of paper notes or metal coins. Once a country has declared a national currency, it can then be used in exchange for goods and services. This does not make the currency universal though and in many cases one currency needs to be exchanged for another (foreign exchange) for goods and services to be transferred between countries.
U.S. Dollar Index - Started in 1973, the USDX is an index that weighs the value of the U.S. dollar against other major currencies. It is currently calculated using the exchange rate of the euro, Japanese yen, Canadian dollar, British pound, Swedish krona and the Swiss franc.
Euro - Started in 1999, the euro was relatively invisible for the first three years of its existence. Now it is used by 17 out of the 27 Member States of the European Union. Considered to be a fast growing currency, it is one of the most traded currencies on the market.
Japanese Yen - Started in 1871, the Japanese yen is a floating exchange rate, which values itself against the U.S. dollar. Globally, the yen is the third most traded currency and considered highly volatile.