NEW YORK Jan 29 Daily currency volume in the
world's largest foreign exchange centers posted mixed results
with drops in the United States, United Kingdom and Canada, but
gains in Japan, Singapore, and Australia, a biannual survey from
major central banks released on Tuesday showed.
A euro zone debt crisis which drove down volatility and low
interest rate regimes around the world have reduced forex
transactions in the Western Hemisphere, analysts said, although
these factors didn't seem to affect turnover in the Asia-Pacific
In North America, total volume was $793.5 billion in October
2012, down 7.7 percent from April. That was also 18.8 percent
lower than a year earlier. The New York Federal
Reserve-sponsored Foreign Exchange Committee (FXC) said the
October volume reflects disruptions related to Superstorm Sandy.
Data on North American volume came from 25 active financial
institutions in the country.
Spot transactions posted the sharpest decline among all
forex instruments in the U.S., sliding 32.7 percent year-on-year
to $381.1 billion. Only forward transactions showed an increase,
rising 6.1 percent to $143.6 billion in October.
The fall in volume was also most pronounced for transactions
involving the euro versus the U.S. dollar, the FXC said.
Declines in deals on euro/dollar accounted for roughly
two-thirds of the overall decrease in daily turnover.
The euro for most of last year traded within very narrow
ranges as the European Central Bank undertook measures to combat
the region's debt crisis. That resulted in lower volatility and
limited profit opportunities.
In the UK, the average daily turnover fell 5 percent in
October from the April level to hit its lowest since October
2010, a Bank of England survey of 30 financial institutions
Average daily turnover of spot, outright forwards,
non-deliverable forwards, swaps, foreign exchange options and
currency swaps totaled $1.919 trillion, down from $2.014
trillion in April and a 7 percent drop from the same period in
2011, the BoE said.
The UK is the largest currency market in the world.
Spot foreign exchange activity fell 6 percent to $678
billion per day from $719 billion in April.
CLS VOLUME DATA
The results in the U.S. and UK were consistent with volume
data from foreign exchange settlement system CLS Bank. CLS data
on Tuesday showed global average traded values in spot, swaps
and forwards were down 7 percent than a year earlier. But it
rose 4 percent in October to $1.713 trillion from April's $1.65
Major governments around the world have responded to the
global financial crisis by reducing interest rates to their
lowest levels, damaging risk appetite and carry trade
transactions. Banks -- especially the smaller ones or
non-dealers -- and most buyside participants as a result stepped
away from the currency market.
In Canada, the average daily foreign exchange volume slid
14.4 percent to $51 billion in October from $59.6 billion in
April. Spot foreign exchange transactions declined 23 percent
from the April level. The Canadian survey took volume data from
the country's top seven banks.
It was a different story in the Asia-Pacific world.
In Tokyo, daily foreign exchange volume edged up 6.3 percent
to $300.5 billion in October from $282.6 billion in April, based
on a survey of 19 major banks in Japan.
Spot and forward transactions fell 9.1 percent and 1.2
percent respectively from the April figures, but forwards showed
a sharp 25.1 percent increase in October.
In Singapore, daily turnover grew 5 percent in October to
$53.9 billion, compared with $51.3 billion in April, data showed
from the top 30 financial institutions in the country.
The total monthly volume was $2 trillion, up 7 percent from
April's $1.88 trillion turnover.
Finally in Australia, the average daily volume was $186
billion, up 6 percent from the April level and 12 percent higher
than a year earlier. The data was drawn from 25 financial
institutions in the country.