Q4 2016 Intelligence Report – Summarizing a Very Dramatic Year

In almost all fields of the multi-asset trading industry, we have seen immense volatility during the final chapter of 2016.

The final chapter of 2016 was a perfect ending to a turbulent and even crazy year. In almost all fields of the multi-asset trading industry, we have seen immense volatility that correlates with the volatility in the politico-economic sphere.

Washington Leads the Way

While we’re still contemplating the aftermath of the Brexit vote, Donald J. Trump was elected as the President of the United States of America at the climax of a surprising and dramatic presidential campaign. Now that the dust has settled (well, at least with regard to the campaign), it’s time to cast a look to the future and think what the implications of Trump’s presidency will be.

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So, in the short term, American stocks have rallied, in what appears to be a vote of confidence from investors. In the long term, the effects of his policies and the reactions to them are yet to be seen. Many promises have been scattered, and judging by the first days of his presidency, Trump is eager to fulfil them.

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Without a doubt, the steps toward trade protectionism that Trump is planning, from erecting a wall on the border with Mexico to hiking import tariffs, will affect global trade and the global economy in general. Another crucial issue that will influence the global economy is the reduction of regulations, in an attempt to ease the cost of doing business in the US. And yet an even more important issue will be Trump’s intention to change or even repeal the Dodd-Frank regulations. As for the strength of the dollar, there are contradicting hypotheses about what exactly is going to happen.

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In the old continent, the sky is looking very grey, as the European Union appears to be slowly disintegrating. The process of the UK’s disengagement from the union is soon to begin, and populist Eurosceptic movements continue to gain strength all over the continent.

And while the Western powers are in the midst of a period of soul searching, East Asian economies continue to gain steam. This pattern is also evident with respect to the trading industry, as Western brokers seek to enter Asian markets and brokers from China, Japan, Indonesia and more successfully expand westward.

Volumes on the Rise, Despite the Regulations

All these factors and more will be at the center of the changing global economic landscape, and more specifically, the trading industry. So far, the effect of this political and economic rollercoaster seems to be quite positive. The volumes of global retail forex trading have risen 9% QoQ and 75% YoY in the last quarter of 2016, bringing it closer to the level of the first quarter of 2016.

Having said that, not everything is peachy. As always, various regulators are raining on the trade-parade. In October, the European regulator ESMA announced the ban on bonus promotions. Then, CySEC, BaFin and the FCA announced their own restrictions on the retail forex and binary options industries. This notion of toughening the rules is expected to continue in 2017, and will perhaps even develop into the eventually outlawing of the binary options industry altogether in some countries.

All these dramatic events and their implications are covered in our brand new Intelligence report.

To get the full report, click on the link below:

Per Quarter
€510
1 issue per Year
-
Digital Version delivered to your email
Annual
€1,780
4 issues per Year
-
Digital Version delivered to your email

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