FXSpotStream Marks Seasonal Decline in Trading Volumes

The month of July has proven to be less active for institutional traders.

FXSpotStream has just published its trading volumes for foreign exchange products for the month of July. The company posted a monthly decline of 13.6 percent during the month, reporting an average daily volume of $17.6 billion last month. The number is in line with industry trends in institutional trading as substantial market players have pulled back from the market during the month.

The report from FXSpotStream comes after the company posted its most active month for the year in June. Despite somewhat higher volatility towards the end of the month, big institutional players appear to have remained on the sidelines in the latest dollar index move.

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FXSpotStream’s result is lower by 10.7 percent when compared to last year. The figures in 2016 were affected by the post-Brexit volatility of the British pound.

Total trading volumes at the trading venue declined to $368.6 billion, which is a decrease of about 17 percent when compared to last month. The decline is partially exacerbated by the one extra trading day in June. The figure was 10.6 percent lower than a year ago.

As FX volatility picks up due to political turmoil in the Trump administration and converging monetary policy paths across the globe, trading volumes are likely to rise in the coming months. The US Fed is expected to start trimming its balance sheet in September, an event that could trigger additional volatility across financial markets.

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