What is cable in forex
Cable is the trader nickname for the GBP/USD currency pair, the exchange rate between the British pound and the US dollar.
A currency pair shows how much of one currency buys another. In GBP/USD, the pound (GBP) is the base currency and the US dollar (USD) is the quote currency. The price tells you how many US dollars one pound buys.
The name comes from the telegraph cable laid under the Atlantic Ocean. Before radio and computers, dealers in London and New York sent pound-dollar prices to each other over this cable, and "cable" stuck as the name for the rate.
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Formal definition and edge cases
For experienced traders, the precise usage is narrower than "anything with the pound in it":
- Cable means spot GBP/USD. It is quoted with the pound as base. Few people say "cable" for USD/GBP, the inverted quote.
- Other pound pairs are not cable. EUR/GBP, GBP/JPY and GBP/PKR are not called cable. Traders say "sterling" or "the pound" when they mean the currency in general.
- Forwards and futures. Dealers may say "cable forwards" for GBP/USD forward contracts. The forward price is the spot price adjusted by forward points.
- "Pound-dollar" is a common synonym in reports. "Sterling" refers to the currency itself, not the pair.
Worked example (hypothetical)
Say a trader opens a position that profits if GBP/USD rises. The trader is long the pound and short the dollar at the same time.
- If cable rises, each pound buys more dollars, and the long position gains.
- If cable falls, the position loses by the same logic.
- The result is calculated in the quote currency, US dollars, and then converted to the account currency if that is different.
To put real figures on this (pip value, position size and margin), use the tools on the calculators page. Enter the pair, your lot size and your account currency there instead of relying on rough guesses.
Leveraged forex and CFD trading can lose money fast. A small move in cable on a large position can wipe out a deposit, so read risk management before trading any pair.
Where the term appears
| Place | How it appears |
|---|---|
| Trading platforms | Usually as a symbol such as GBPUSD. Brokers name symbols differently, so check the symbol list in your platform. |
| Market news | Headlines like "cable slips after UK data" or "cable holds near the big figure" |
| Bank and dealer reports | "Cable" in morning notes and FX commentary |
| Chat between traders | Short form for GBP/USD, for example "long cable" |
The big figure is the leading part of the price that dealers often skip when quoting cable verbally.
Related terms
- Fiber (EUR/USD): the nickname for the euro-dollar pair
- Currency pairs: majors, minors and how quotes work
- Currency risk: exposure to exchange-rate moves
- Currency appreciation and depreciation
- Forward contract
- Trading glossary
Frequent questions
What does "cable" mean in forex?
It is the nickname for GBP/USD, the price of one British pound in US dollars.
Why is GBP/USD called cable?
Pound-dollar prices were once sent between London and New York over a telegraph cable under the Atlantic, and the name stayed.
Is GBP/JPY or EUR/GBP also cable?
No. Cable refers only to GBP/USD.
What does "long cable" mean?
It means holding a position that gains if GBP/USD rises: long the pound, short the dollar.
Does the cable nickname change how the pair trades?
No. It is only a name. The pair is traded and priced like any other major currency pair.