Currency Index Formula

[usilboy]

I found USD Index formula :
usdx = usdeur ^ 0.576 x usdjpy ^ 0.136 x usdgby ^ 0.119 x usdcad ^ 0.091 x
usdsek ^ 0.042 x usdchf ^ 0.036 x 50.14348112

But the same for EUR Index ,GBP Index ,CAD Index ,JPY Index ,CHF Index ,AUD Index , NZD Index cantbe find even by google
Can u guve indications?
Thnks . . . . . . . . .

 

[Jonathan Lee]

The formula for the USD Index (USDX) is based on a weighted geometric average of the U.S. Dollar's value relative to six major currencies. For other currency indices (EUR, GBP, CAD, JPY, CHF, AUD, NZD), there isn't a universally defined, publicly available formula like USDX. However, you can approximate them by applying similar principles.


Here are some general steps to construct an index for any currency:

1. Identify Major Currency Pairs: For each currency (EUR, GBP, etc.), you'll need to identify a basket of major currency pairs that the currency is traded against (like EUR/USD, GBP/USD, USD/JPY, etc.).
2. Assign Weights: Assign appropriate weights to each currency pair. The weights may differ depending on factors like trading volume, liquidity, and economic significance. The more significant trading pairs usually receive higher weights.
3. Calculate Exchange Rates: Gather exchange rates for the relevant pairs (for example, EUR/USD, EUR/GBP, EUR/JPY, etc., for the EUR Index).
4. Use Geometric Average: Like the USD Index formula, use the geometric mean of these exchange rates raised to their respective weights to calculate the index.
5. Adjust for Scaling: Apply a constant to adjust the final index value to a base level for consistency.

Since the specific formulas are not publicly available for these indices, constructing your own requires access to live exchange rate data and determining the appropriate weights based on market conditions. Additionally, you may refer to specialized financial services or institutions that calculate these indices and publish them.