Trading activities in spot foreign exchange among institutional investors weakened last month across regions, data from Cboe FX, Deutsche Börse's 360T, FXSpotStream and Click 365, shows. The decline comes after major trading venues reported stronger output earlier in March.
In January, the institutional spot FX demand recovered from the holiday lows in December only to retreat in February. By March, the volumes picked up again; although new data shows the volumes shrunk at the end of April.
Demand Drops across Regions
Cboe FX, an American spot FX trading platform handled 29% less volume in April as total volumes shrank to $793 billion, which is down from $1.1 trillion in March and was its second best month in its history. Additionally, the average daily volume (ADV) handled by the platform decreased 18% from $48.4 billion in March to $39.7 billion last month.
In February, Cboe FX's total volume stood at $837.9 billion. However, by the end of the first quarter in March, Cboe FX set new volume records, including spot FX ADV of $43.9 billion.
Furthermore, FXSpotStream, a New Jersey-based provider of multibank price streaming services for FX spot and swaps , among other instruments, reported a decline in its volume. Total volumes generated by the aggregation services provider slumped 28% month-over-month (MoM) to $1.1 trillion, which is down from $1.5 trillion in March. In February, the volumes came in at approximately $1.3 trillion.
Similarly, FXSpotStream’s ADV decreased 17.2%% MoM and 9.7% YoY to $55.3 billion, which is down from approximately $67 billion last month. However, April had 20 trading days, unlike March with 23 trading days.
At 360T, one of Europe’s biggest institutional FX trading platforms, daily spot volumes in April added up to $507 billion, which is down 21% from the $642 billion generated at the end of March. Moreover, the April total volume is lower than the $530.9 billion generated by the trading platform in February.
In Asia, the total volume of FX daily futures contracts traded on Click 365, an online trading platform operated by the Tokyo Financial Exchange (TFX), dropped 43.3% MoM and 41.7% YoY to 1,897,088. This is the biggest fall in volumes compared to declines in trading activities across other regions. The average daily volume during the month came in at 94,854 contracts.
Click 365 allows market participants to trade futures contracts on major currencies, including the US dollar, euro, British pound, and Australian dollar. The platform was launched in 2005 by TFX as the world’s first exchange-traded FX daily futures contracts platform.
Revolut in Brazil; WeChat's digital yuan expansion; read today's news nuggets.
