The dollar, which has been clearly marching north for two months and testing two-year highs against a basket of currencies, has positively influenced the dynamics in the institutional FX market. As a result, trading volumes in major centers worldwide rebounded in November after falling to five-month lows in October.
FX Spot Volumes Bounce from Local Bottoms
Click 365, the currency trading platform on the Tokyo Financial Exchange (TFX), recorded a monthly (MoM) volume increase of 5.3% to 1,797,103 contracts after several consecutive months of decline. The average daily volume (ADV) stood at 85,578 contracts.
Year-over-year (YoY), this still represents a significant decline of almost 20%. As in previous periods, the highest trading activity was observed on the USD/JPY currency pair, reaching over 534,000 contracts (down 2% MoM and 30% YoY).
The monthly volume rebound was also evident in the United States. Cboe exchange spot FX volumes returned above $1 trillion after falling to $984 billion in October.
The average daily volume also grew significantly, reaching $47.7 billion, the highest value since August, though this was helped by fewer trading days. October had 23 trading days, while last month had 21.
Weak Euro but Strong Volumes
In Europe, German stock exchange -owned 360T also recorded an increase in volumes, which grew to $664 billion after sliding to $657.7 billion in October. Better performance and fewer trading days also allowed ADV to rebound to $31.6 billion, reaching three-month highs.
The EUR/USD currency pair closed its second strongly bearish month in a row, losing 2.8% in November and briefly testing two-year lows. However, this didn't adversely affect FX trading dynamics.
For Euronext FX's Fastmatch, the results look very similar. Total volumes grew for another consecutive month, reaching $613 billion, while ADV increased by almost $3 billion to $29.2 billion.
These results are also significantly better than last year. In November 2023, total volumes on Euronext FX were $535 billion, while on 360T they were just under $596 billion.
