MOEX's November FX Demand Remains Flat

Moscow Exchange (MOEX) published its trading metrics for November, reporting its forex market trading volume of RUB 14.8 trillion, which is marginally lower than the previous month's RUB 14.8 trillion. Spot trading activities amounted to RUB 6.4 trillion whereas the rest of RUB 8.4 trillion came from FX forwards FX Forwards FX forwards are contracts occurring within the foreign exchange market where market participants lock in exchange rates for the buying or selling of a currency on a predetermined date. Sometimes known as currency forwards, FX forwards can be thought of as a customizable hedging approach.In this sense, upfront margin payments are not required and all contracts are over-the-counter (OTC) due to the decentralized nature of the foreign exchange market. Popularity of FX ForwardsFX forwards are popula FX forwards are contracts occurring within the foreign exchange market where market participants lock in exchange rates for the buying or selling of a currency on a predetermined date. Sometimes known as currency forwards, FX forwards can be thought of as a customizable hedging approach.In this sense, upfront margin payments are not required and all contracts are over-the-counter (OTC) due to the decentralized nature of the foreign exchange market. Popularity of FX ForwardsFX forwards are popula Read this Term.

The monthly average daily volume came in at RUB 704.3 billion, which is down from RUB 710.3 billion in October. It came after the Russian exchange ended the third quarter with a 61.9 percent growth in income from fees and commissions in the forex Forex Foreign exchange or forex is the act of converting one nation’s currency into another nation’s currency (that possesses a different currency); for example, the converting of British Pounds into US Dollars, and vice versa. The exchange of currencies can be done over a physical counter, such as at a Bureau de Change, or over the internet via broker platforms, where currency speculation takes place, known as forex trading.The foreign exchange market, by its very nature, is the world’s largest tradi Foreign exchange or forex is the act of converting one nation’s currency into another nation’s currency (that possesses a different currency); for example, the converting of British Pounds into US Dollars, and vice versa. The exchange of currencies can be done over a physical counter, such as at a Bureau de Change, or over the internet via broker platforms, where currency speculation takes place, known as forex trading.The foreign exchange market, by its very nature, is the world’s largest tradi Read this Term market.

Ups and Downs of the Market

MOEX is the largest trading venue in Russia, offering trading services not only with forex but also in equities and bond markets, derivatives markets and the money markets. Despite the marginal slump in the forex market, the overall trading demand strengthened by 42 percent month-over-month. In absolute terms, November's total monthly trading volume came in at RUB 74.7 trillion compared to RUB 71.7 trillion in the previous month.

The most significant forward push for MOEX's volume was due to the increased demand in the equities and bond market. Overall, the trading volume in those two markets increased by 62.2 percent to RUB 3.16 trillion. This figure was at RUB 1.9 trillion in the previous month.

Specifically, the trading volume in the bond market grew by 144.4 percent to RUB 2.3 billion. The exchange detailed that the trading volume in shares, DRs and investment fund units was RUB 859 billion, which decreased from the previous month's RUB 1 trillion. The ADV of this market declined from RUB 40.9 billion to RUB 48 billion.

The derivatives market of MOEX also witnessed a slowdown as trading volume declined to RUB 3 trillion from RUB 3.6 trillion in October. The ADTV came in at RUB 144.6 billion, which is down from RUB 169.1 billion. Meanwhile, the turnover in the money market grew by 4.5 percent to RUB 52.4 trillion. Furthermore, activities in the precious metal and commodities markets jumped by 27.7 percent and 18.8 percent, respectively.