FXPA Commends FX Industry on How it Prepared for Brexit Volatility

Following last Friday’s heightened Volatility Volatility In finance, volatility refers to the amount of change in the rate of a financial instrument, such as commodities, currencies, or stocks, over a given time period. Essentially, volatility describes the nature of an instrument’s fluctuation; a highly volatile security equates to large fluctuations in price, and a low volatile security equates to timid fluctuations in price. Volatility is an important statistical indicator used by financial traders to assist them in developing trading systems. Trad In finance, volatility refers to the amount of change in the rate of a financial instrument, such as commodities, currencies, or stocks, over a given time period. Essentially, volatility describes the nature of an instrument’s fluctuation; a highly volatile security equates to large fluctuations in price, and a low volatile security equates to timid fluctuations in price. Volatility is an important statistical indicator used by financial traders to assist them in developing trading systems. Trad Read this Term in currency markets after the UK’s Brexit Brexit Brexit stands for British Exit, or in reference to the United Kingdom’s decision to formally leave the European Union (EU) as declared in a June 23, 2016 referendum. In a more immediate sense, a tight vote and unexpected result helped drive British pound (GBP) to lows that had not been seen in decades.The day following the referendum, former Prime Minister David Cameron resigned from office where he was replaced by Theresa May, who later resigned from office on June 7th, 2019. Active Prime Minis Brexit stands for British Exit, or in reference to the United Kingdom’s decision to formally leave the European Union (EU) as declared in a June 23, 2016 referendum. In a more immediate sense, a tight vote and unexpected result helped drive British pound (GBP) to lows that had not been seen in decades.The day following the referendum, former Prime Minister David Cameron resigned from office where he was replaced by Theresa May, who later resigned from office on June 7th, 2019. Active Prime Minis Read this Term vote, the Foreign Exchange Professionals Association (FXPA) today commended the industry for how it prepared ahead of Britain’s referendum, according to an update on the FXPA website.

The FXPA said that currency markets functioned relatively smoothly in the initial hours and days after the polls closed, a perspective that others have shared including in coverage by Finance Magnates since last week.

The FX industry prepared for this unprecedented event with enhanced staffing in all areas throughout the night, with technical and capacity planning.

FX Markets functioned smoothly

A large number of online retail FX brokers and some institutional venues had cut leverage going into the Brexit vote, in addition to taking other related preparations.

A spokesperson provided a statement on behalf of the FXPA: “The FX industry prepared for this unprecedented event with enhanced staffing in all areas throughout the night, with technical and capacity planning.”

Will Brief US Regulators

“The British pound dropped precipitously as the Brexit vote became known, yet the FX industry’s infrastructure and resiliency ensured the smooth operation of the market during bouts of extreme volatility, which is a necessity in allowing the market to express its views,” the FXPA added in the statement.

The FXPA also noted that it will brief US government regulators, and further noted: “In the coming weeks and months, the FXPA will provide a forum for market participants to ensure such operational consistency continues as the implementation of the Brexit plays out. The FXPA will also, in the course of its normal activity, be briefing US government regulators on how the market functioned during this historic night.”