October volumes from the CME show that FX trading remained robust during October, with 983,620 combined average daily futures and options contracts traded. The figure was 11.3% below September, but around 50% above the same period in 2013.
The month-over-month dip in volumes occurred after September’s volumes rose 72% from August. As a result, despite the drop, October volumes remain well above levels from earlier in the year. On a total monthly basis, volumes were 6.1% lower at 22,623,257 contracts traded (October included one additional trading day than September).
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The overall decline in volumes was most affected by a drop in British pound volumes. This was expected as pound trading spiked in September in reaction to the Scottish Referendum vote which led to price speculation in the currency.
Among other major currencies, volumes in the Japanese yen showed the most growth. The volumes occurred as the US FED announced it was holding off from another round of quantitative easing, while the Bank of Japan decided to continue its economic stimulus plans which it began at the end of 2012. The result is the USD/JPY now trades at seven-year highs as it fluctuates around 113.00.
In what could be considered a surprise, despite the inaction from the FED which appears to have curbed interest of the carry trade as seen by a drop in volume in the Australian dollar and Mexican peso, New Zealand dollar activity rose slightly in October.