What does FOREX refer to in the financial market?

FOREX, short for Foreign Exchange Market, refers to the global marketplace for trading national currencies against one another. It is the largest and most liquid financial market in the world, where currencies are bought and sold, and exchange rates are determined. This market enables international trade and investment by allowing businesses and individuals to convert one currency into another. The functioning of the FOREX market is vital for the smooth operation of the global economy, as it facilitates transactions across various countries, enabling travel, commerce, and investment to occur seamlessly.

The term 'FOREX' itself emphasizes the nature of this market, focusing specifically on foreign currencies, as opposed to other financial activities or markets that might involve stocks, bonds, or commodities.