The Bank of England today released their latest semi-annual FX turnover survey results for April 2013.
Highlights
- Record Daily FX vol of $2,547bln, +26% on Oct 2012, (+26% YoY)
- Spot vols +38% to $1,006bln/day
- Rise driven by huge increase in USD/JPY activity up over 100% to $503bln/day – 2nd most active curr pair traded
Execution via Single Dealer Platforms (SDPs) still exceeds Multi Dealer Platforms (MDPs), but MDP volumes surging
- SDP vols + 32% driven by +58% increase in use by Reporting Dealers and +18% by banks
- MDP vols +69% driven by +77% rise in Non-Bank Financial Institutions and +71% by reporting dealers
FX Volumes by Product
Spot FX accounted for 39% of daily FX vols (+38% on Oct 12), and +40% YoY
Whilst FX Options account for only 1% of daily flows, they saw a 71% rise since Oct 12 to $185bln/day
Chart showing Daily FX vol by-product type (source: Bank of England Survey data)
SDP vs MDP flows
SDP vol: $366bln/day, +32% on Oct 2012, and +30% YoY
MDP vol: $349bln/day, +69% on Oct 2012, and +64% YoY
Coverage of previous BofE survey data here
The ratio of FX flows being executed via SDPs compared to MDPs dropped to a new low of 105% from 134% in Oct 12 as shown by the continues red line in chart below. Major Multi-Bank Platform flows EBS/FXall here.
Chart showing SDP and MDP vols (source: Bank of England Survey data)
Product Flows by SDP & MDP
The chart below shows flows by product type between SDP and MDPs. As can be seen the the major change since Oct has been the increase of spot flows through MDPs, and the increase in Swaps flows through SDPs.
Client Segment Flows
In terms of client segments, non bank financial institutions have for the first time equaled, and look set to exceed flows by other (non reporting) bank. This rise has accounted for much of the increase in flows seen by MDPs.
Chart showing pct of flows by client segment (source: Bank of England Survey data)
Client Segment Flows by SDP & MDP
When looking at the execution preferences of each client segment, reporting dealers are increasing the proportion of flows via SDPs, whilst non-bank financial institutions are preferring to trade using MDPs. The three charts below, show client segment flows on SDP, MDP and finally the shift between them (SDP-MDP) for these client segments.
Chart showing $bln flows by client segment via SDP (source: Bank of England Survey data)
Chart showing $bln flows by client segment via MDP (source: Bank of England Survey data)
Chart showing $bln flows ‘shift’ by client segment from SDP vs MDPs (source: Bank of England Survey data)
Bank of England Survey PR here
