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ForexE
Exotic Pair
Currency pairs involving one major currency and one from a developing or emerging economy. Examples: USD/TRY, EUR/ZAR. Typically wider spreads and less liquidity.
Example
“The trader took a short position on USD/ZAR, an exotic pair, after the South African Reserve Bank raised rates unexpectedly, but had to account for the 8-pip spread and high overnight swap costs.”