Exchange rates are always written in the form of quotations. A quotation reflects the number of quote currencies that can be bought by using a single unit of reference currency.
When an exchange rate is quoted for a currency pair, the currencies are usually quoted in order of their importance, which is as follows:
In case the conversion is from a Great Britain pound to an Australian dollar, the Great Britain pound would be placed on the left. It will be the base currency.
In certain markets in the United Kingdom and Europe, the order is determined differently. The position of the Great Britain pound and Euro is switched. The pound is treated as the base currency and the Euro is considered as the term currency.
If the currency pair does not comprise any of the currencies listed above, the Forex market considers that currency as the base, whose exchange rate is more than 1.000.
In other countries like Japan, they use the home currency as the base. This method of quoting exchange rates is called direct quotation or price quotation.