How Do the FX Platforms Compare to the Turnover Data?

It was very much a mixed bag for those platforms that report FX turnover on a monthly basis when looking at the annual change in spot activity in the seven FX committee semi-annual surveys.

Across the seven centres, which collectively made up 81.6% of global turnover according to last year’s Bank for International Settlements’ Triennial Survey, spot activity dropped by 6.4%, largely thanks to sharp declines in Singapore and Japan. By comparison, only one of the seven venues to report FX data saw an increase over that time horizon and two others outperformed the global trend.

Cboe FX saw activity on its spot business actually grow by 7.3% from April 2022 to April 2023, with activity climbing $2.7 billion per day in the latter month. As far as year-on-year gains go, however, that was all the good news to be had in the platform world.

The overall picture was OK for 360T, which saw spot activity decline by just 1.6% over the year, and just about the same for LSEG, whose FX businesses (the company aggregates across multiple venues) saw spot volumes decline by 5.9%

CME’s FX futures and options, which are not directly comparable to the FX committees’ data, saw FX activity decline 6.7%, while FXSpotStream, which was coming off a sustained run of increases up to the middle of 2022, saw year-on-year activity drop by 9.8%. The platform actually reports data across all FX products, so again, it is hard to make a direct comparison.

Euronext FX saw a sharp decline in spot activity, by 19.9%, and it was a similar picture at EBS, which saw ADV drop 20.2% from April 2022 to April 2023. EBS, and perhaps Euronext FX, was likely hurt by a sharp drop in yen activity. Across the UK, US, Japan and Singapore reports, USD/JPY volumes dropped by 16% from April 2022 – this being one of EBS’ historically strong pairs. EUR/USD activity was also down in those four centres, albeit by a more modest 3.7%.

FX swaps activity across the seven centres declined 7.3% year-on-year, so the news was much better for 360T, which reported non-spot volumes rising 7.2% over the same time horizon (using a fixed exchange rate to translate from euros). Elsewhere, LSEG FX also outperformed the global data, with non-spot volumes across its venues being exactly flat, year-on-year to April 2023.

NDF data is only available from the UK and US reports and here ADV rose by 6% to just shy of $200 billion per day in April 2023, by contrast the three platforms to report data – all of whom are still very much in the growth stage as far as NDFs are concerned, report increases of +12% (360T), +44% (Cboe FX) and +133% (24 Exchange).