UPDATE 1-NEX forex trading volume hits 10-month high in Sept

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Oct 4 (Reuters) - Average daily currency trading volume reached a 10-month peak in September as the euro retreated from its recent rally and the dollar recovered from a 20-month low, according to data from NEX Group Plc released on Wednesday.

Spot foreign exchange volume on NEX platform averaged $97.4 billion a day last month, up 17 percent from a daily average of $83.0 billion August. It was 27 percent higher than the $76.7 billion a year earlier, the British financial trading technology company said.

The September figure was the highest since the $107.5 billion daily average set last November.

Daily volume of U.S. Treasuries on its system averaged $160.1 billion in September, up 22 percent from August and 4 percent from a year ago, NEX said in a statement.

There were also increased activities in repurchase agreements denominated in both dollar and euro last month, NEX data showed.

On Sept. 8, the euro hit a 2-1/2 year peak against the dollar on bets the European Central Bank would begin to reduce its bond purchases later this year on signs of an improving European economy.

Meanwhile, the dollar index rebounded from a 2-1/2 year trough against a basket of currencies including the euro on hints from the Federal Reserve it remained on track to raise interest rates gradually.

The Chinese yuan was also actively traded in September with offshore renminbi posted its biggest monthly depreciation since Donald Trump’s surprise U.S. presidential win last November, NEX said in a statement.

Reporting By Richard Leong and Gertrude Chavez-Dreyfuss