Refinitiv Reports Weak FX Volumes as Volatility Slows in 2019

Spot FX trading volumes achieved the worst results in more than a year.

Refinitiv, the former Financial and Risk business of Thomson Reuters, has published its foreign exchange (forex) trading volumes for the month of February 2019, reporting the lowest spot FX volumes since August of 2017.

This Wednesday, the financial markets data provider reported that during the month of February, total volumes of currencies, which was $428 billion fell by 7.6 percent when measured against the same month a year earlier, which achieved a monthly volume of $463 billion.

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This decline was largely driven by a slump in FX price volatility. This low market volatility discouraged traders from buying and selling.

Trading growth is often directly correlated with forex volatility. So far this year, FX volatility has slumped overall, as central banks have all started to press pause on their plans to tighten monetary policy.

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Spot FX Volumes Achieve Worst Result Since August 2017

According to Refinitiv data, Spot FX volumes also shrank by $8 billion or 8.4 percent from January’s trading volume of $95 billion down to $87 billion. On an annual comparison, this is also down by 23.7 percent.

In February of 2019, Spot FX volumes actually saw its worth month since August of 2017, which recorded a total volume of $82 billion. However, other volumes, which include swaps and options, did record a stronger performance.

Specifically, other FX volumes came in at a total of $341 billion during the month of February. This is $10 billion or 2.8 percent less than the previous month, which reported a monthly trading volume of $351 billion.

Not only that, but the volumes achieved in February of 2019 have fallen by 2.3 percent year-on-year. However, even though the results are down on both a monthly comparison, it is still the strongest result (excluding January) since June of 2018.

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