EBS Retains Ground Amidst FX Volume Reversal

While, not unexpectedly, May FX volumes have dropped sharply from the record levels seen in April, the first group of platforms to report data all signalled strong year-on-year increases, a pattern repeated at EBS, which dropped in line with the other venues on a monthly basis, but outperformed in year-on-year terms.

Average daily volume in spot and NDFs at CME-owned EBS was $67 billion across its venues, down some 25% from April, as noted, largely in step with the other platforms. On a year-on-year basis, however, EBS ADV was up 25.2%, notably more than others to report with the exception of 360T, which matched that gain.

As was the case with the other venues, EBS had its second quietest month of the year-to-date, but the year-on-year growth will be heartening given May was clearly a much quieter month – times when the platform has historically, given up ground to its rivals. No breakdown is available to identify volumes through the CLOB, EBS Market – the firm says it saw a record in Taiwan dollar NDFs at the start of the month – so it is not clear whether the business was retained through that channel, but either way, CME is likely to be happy with the numbers.

In CME’s FX futures and options business, there was also a steep drop from April, by just over 31%, and on a year-on-year basis, in notional terms, ADV was unchanged at $75 billion per day. Perhaps given a hint into the better numbers at EBS, CME says its EUR/USD (+7% y-o-y) and USD/JPY (+23%) contracts – both of which pairs are EBS strongholds – had good months, as did BRL and KRW, which both set monthly volume records. EUR/USD options volume was up 63% and the contract set a new monthly open interest record – indication that while volume may be down, players are still positioning frequently.

CME’s FX link was not boosted by the launch of FX Spot+ at the firm, in spite of some expectations, recording $2.9 billion per day in notional volume, down 40.8% from April and down 14.7% year-on-year. CME’s G5 CVOL Index also dropped in May, averaging 9.6 from 11.21 in April, but it remains at elevated levels in terms of recent readings.