Here’s an unanswerable question: How will future economic historians regard those countries in Europe that chose to remain outside of the euro?

The consolidation of 12 currencies into the euro removed 66 different currency pairs from the interbank market. We will pass on the question of whether the world is better or worse without Finnish markka/Portuguese escudo cross-traders, but we will note the combined absence of all these cross-rate trades did lead to a pronounced drop in global currency volatility (see "Currency trends and volatility", Currency Trader, November 2006).

The GBP/EUR and CHF/EUR are the two principal trades remaining within the euro bloc, the currency world’s counterpoint to the U.S. dollar bloc (see "The dollar index and 'firm' exchange rates", Currency Trader, December 2005). What drives them, and what information can we derive from their movements?