Godfried De Vidts President, ACI
Godfried De Vidts President, ACI

Volume in the FX market

Godfried De Vidts looks at why e-trading volumes will continue to grow in the FX market.

When the BIS released the final analysis on its FX triennial survey in September 2004 the daily turnover in April of that year amounted to $1.9 trillion. The period 2001-2004 saw the growth of electronic broking as one factor. However, other related factors such as the presence of clear trends and higher volatility, higher hedging activity and interest differentials by the traditional "carry" trade have also been mentioned. The report confirmed the increasing buy side trading as the main driver behind the surge of turnover.The release of the results of the 4th Survey of North American Foreign Exchange volume for April 2006 showed an average daily volume of OTC FX instruments (spot, outright forwards, fx swaps and options) totalling $577 billion increasing by 31.5 percent over the April 2005 reporting period. Mark Snyder, Chair of the Foreign Exchange Committee in the USA, commented on the survey showing in particular the strong increase in electronic trading volume. E-trading systems grew from $65 to $132...continued

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