Global FX Turnover Dips in October: Up YoY

The latest semi-annual surveys of FX turnover published by the world’s seven major FX committees shows that activity slackened off from the peak in April 2024, but remained healthily up year-on-year.

Overall, turnover across all products in all seven regions was $6.935 trillion, down 4.5% from April, but up 10.9% on the previous October. Four of the seven; the UK – which has historically produced lower turnover in October than April – Singapore, Hong Kong and Japan, saw activity decline from the previous survey, but all except Hong Kong and Japan were up year-on-year, the latter two dropping 2.2% and 6.2% respectively.

On the positive side, the US recorded its highest ever ADV and was above the $1 trillion mark for the fourth time since it started reporting data in 2005. Indeed, with the UK remaining, comfortably, the biggest FX centre, for just the second time – the first being April 2024, three centres printed volumes over $1 trillion, with Singapore reinforcing its growth, albeit not hitting a new high.

If the data was reflected in the BIS Triennial Survey, due to be taken in April and published in September, global turnover would register somewhere close to the $7.8-7.9 trillion mark.

While turnover was down from April in all products with the exception of outright forwards (which includes NDFs), on a year-on-year basis it was comfortably up across all four.

Across the seven centres, spot volumes were just over $2 trillion per day, up 10.1% from October 2023, while outright forward volumes rose dramatically, by 30%, to $1.26 trillion (including NDFs where reported). The biggest FX product, FX swaps grew by a more modest 5.5% to $3.2 trillion, while FX options also saw an impressive gain of 21.2% to $421.6 billion.

The pace of growth over the past three years can be seen in a comparison with the BIS Triennial Survey of 2022, spot volumes across just the seven centres is now just $100 billion per day short of global ADV in April 2022, while outright forwards and FX options volumes have surpassed that benchmark. Only FX swaps, some $600 billion per day short of the BIS number, has failed to make up serious ground.

Outright forward (reiterating this includes NDFs) is at its highest level since the committees starting publishing data almost 20 years ago, while FX options ADV is at its second highest, only beaten by April 2024.

Regional Variations

As noted, the year-on-year data offered a varied picture across the regions. The UK remains, comfortably, the world’s largest FX market, with daily turnover of $3.22 trillion in October – up 9.9% from the year previous. Spot volumes declined from April, but were up 5.3% year-on-year at $908.75 billion – the second highest (to April, naturally) since October 2014. Outright forward activity was also up, to its second highest after April 2023, at $428.2 billon per day – the same was true of NDFs, which saw $177.5 billion per day, second to April’s record of $196.4 billion, but up 6.6% year-on-year.

Although activity remains high, volumes have dropped off in the UK in recent surveys, and at just over $1.4 trillion per day, October 2024 was only the eighth highest since reporting began. It did, however, rise 4.6% from October 2023.

FX options, as is actually the case elsewhere in the reports, produced a strong performance in October at $230 billion per day, just off the record set in April of $236 billion. Year-on-year in the UK, FX options volumes were 32.7% higher.

Perhaps the standout centre in the latest reports is the US, which recorded turnover of almost $1.2 trillion in October, it’s highest yet. This is up 17.2% from October 2023 and even managed to rise from April, by 2.7%.

Spot volumes were $519.3 billion per day – the highest since October 2011 – and up an impressive 19.1% year-on-year. Outright forwards, including NDFs, hit a new high at $248.5 billion, up 29% year-on-year, within this, NDF volume rose to $75 billion, up 41% from October 2023, and also the highest yet recorded by the product in the US.

As is the case in the UK, FX swaps volumes remain historically high but off recent peaks, at $351 billion per day ((+10.8% year-on-year), while FX options have held onto gains registered in October 2023, and at $77.5 billion per day are up 2.5% from October 2023 and the second highest recorded by the survey.

Canada also hit a new high for turnover, at $224 billion per day, it has broken through the $200 billion threshold for the first time, rising 26.7% year-on-year. The growth was across the board, but particularly noticeable in FX swaps, which rose 24.7% to just shy of $157 billion per day. Spot volumes were up 32.1% to $25.9 billion, outrights by 20.6% to $21.7 billion and options by 22.7% to $5.4 billion. Currency swaps remains a thriving market in Canada, with turnover hitting $14.3 billion, just off the April peak and up 60.7% year-on-year.

Singapore continues to establish itself as the major FX centre in Asia-Pacific, meanwhile, turnover stayed above the trillion-dollar mark at $1.05 trillion, down from April but up 21.3% year-on-year.

In spite of quieter conditions, spot activity rose by 27.5% year-on-year, to a new high for the report at $276.3 billion. The same was true of outright forwards, presumably including NDFs – the Singapore FX Committee’s report is notoriously vague – which hit a new high at $127.1 billion, a massive 93.2% rise from the year previous.

As was the case elsewhere, FX swaps activity came off the boil, but was still the second highest yet recorded, at $524.5 billion (up 14.1% year-on-year), while FX options hit its third highest level at $68.3 billion, up 31.7% year-on-year.

Meanwhile, the Tokyo FX Committee, rather enigmatically given it has been a week late for the last two survey releases, published its data for October 2024 a week early!

While it may not be a surprise to find that turnover dropped from April 2024, a month when the Bank of Japan was active intervening in USD/JPY, overall activity in Japan in October 2024 was at its lowest since October 2019 and spot ADV recorded its lowest level since October 2012.

Overall ADV in Japan was $399.2 billion – the first time it has dropped below $400 billion per day since October 2019, indeed in October 2022 it was just over $500 billion per day – with the decline exclusively the result of lower spot activity. FX Swaps volume was $238.4 billion, up 3.9% year-on-year; while outright forward ADV was $43.8 billion, up 6.6% from October 2023 (both were down on April 2024). FX options volumes rose from both April and the previous October, however, to $12.4 billion per day, a 19.2% year-on-year increase.

Spot activity was down to $100.5 billion per day, a 22% fall from April and 18.6% down from October 2023.

Hong Kong also saw a decline in activity, to $668.9 billion from $683.8 billion the year before, thanks mainly to a decline in FX swaps, although all products were lower from April. FX swaps volume was $438.1 billion, again, repeating the pattern elsewhere, this is historically high but off recent peaks, being down 6.6% year-on-year.

Elsewhere, spot volumes were $133.4 billion, up 7.1%, outright forwards $64.4 billion, up 3.5%, and FX options $26.9 billion, up 12.1%

Finally, Australia returned to its highest level since April 2013 at $181.7 billion per day, up 13.3% from April and up 17.8% year-on-year. All products were up from both April and October 2023, with outright forwards hitting their highest yet at $18.2 billion per day, a 30.4% increase year-on-year.

Spot turnover was $45.9 billion, the highest since April 2013 and up 10.3% from October 2023, while FX swaps rose above $100 billion for the first time since April 2014 at $101.2 billion, a 17.6% increase from the previous October. FX options remains a small market in Australia at $1.1 billion per day (up from $821 million in October 2023), while currency swaps activity rose to $5.3 billion from $4.3 billion.