Triennial Central Bank Survey Report on global foreign exchange market activity in 2010

1 December 2010

Press release

The BIS is releasing today the results for both turnover and positions in foreign exchange instruments.

1. Turnover in April 20101

  • Global foreign exchange market turnover was 20% higher in April 2010 than in April 2007, with average daily turnover of $4.0 trillion compared to $3.3 trillion.
  • The increase was driven by the 48% growth in turnover of spot transactions, which represent 37% of foreign exchange market turnover. Spot turnover rose to $1.5 trillion in April 2010 from $1.0 trillion in April 2007.
  • The growth of turnover in other foreign exchange instruments was more modest at 7%, with average daily turnover of $2.5 trillion in April 2010. Turnover in outright forwards and currency swaps grew strongly (by 31% and 36%, respectively). Turnover in the large foreign exchange swaps segment was flat relative to the previous survey, while trading in currency options fell.
  • Activity was supported by the increase in trading by "other financial institutions" - a category that includes non-reporting banks, hedge funds, pension funds, mutual funds, insurance companies and central banks. Turnover with these counterparties grew by 42%, rising to $1.9 trillion in April 2010 from $1.3 trillion in April 2007.
  • Reflecting further foreign exchange market globalisation, cross-border transactions represented 65% of trading activity in April 2010, the highest share ever.
  • The relative ranking of foreign exchange trading centres changed slightly from the previous survey. Banks located in the United Kingdom accounted for 37% of all foreign exchange market turnover, against 35% in 2007, followed by the United States (18%).

2. Amounts outstanding and gross market values at end-June 2010

  • Growth in the positions of OTC foreign exchange instruments was moderate at 9%, compared with an increase of 83% in notional amounts outstanding of currency instruments in the 2004-07 period.
  • In contrast, market values of these instruments almost doubled against a backdrop of increased financial market volatility during mid-April and early June 2010.
  • Trading activity with other financial institutions also drove the increase in the global foreign exchange positions. Their share (45%) surpassed transactions with reporting dealers (36%) for the first time in 2010.

Detailed tables, expanding those published on 1 September 2010, are appended to the report.

 

1 Final data; preliminary turnover data were published on the BIS website on 1 September 2010.