Lull in Forex Markets Persists, EBS Posts Weak Volumes in February 2017

GAIN Capital’s GTX, Fastmatch and CBOE’s Hotspot have all reported monthly declines amid lower volatility.

UK-based NEX Group plc, formerly known as ICAP plc, today reported trading volumes on its electronic foreign exchange (FX) platform EBS for February 2017. The metrics showed a weak performance in the group’s leveraged currency trading business as the new year got off to a calm start while no events were able to whip up a market frenzy. In fact, by some metrics, it was one of the calmest months in years.

More specifically, NEX’s EBS currency-trading platform handled $80.7 billion daily in February 2017, constituting a drop of 13.0 percent month-on-month from $83.8 billion in January 2017. Expanding the scope to encompass a yearly timeframe, EBS’s last month’s volumes are also lower by more than 21 percent year-on-year compared to $102.6 billion reported back in February 2016.

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The latest figures also mirrored what had been a relatively narrow range of consolidation across EBS’s volumes over the past few months, which have stayed around the $80.0 billion threshold.

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The eerie market lull across the board

This stagnant performance in February was shared by other institutional venues as a whole and has thus far not been specific to one exchange. GAIN Capital’s GTX, Fastmatch and CBOE’s Hotspot have all reported monthly declines amid lower volatility, as Finance Magnates reported this week.

NEX Group’s US Treasury activity during February 2017 had a similar narrative, given a drop of nearly 17 percent year-on-year in average daily volumes. During the previous month, US Treasury activity volumes came in at $173.4 billion, down from $208.0 billion in the same month a year earlier. Across a monthly interval, February’s volumes reflect a 3.0 percent weakness from $178.5 billion in January 2017.

In terms of US repo rates, volumes were lower 5 percent year on year to an average of $202.0 billion and 6 percent lower on a monthly basis. In a different vein, European repo volumes were higher 15 percent on 2016 figures, coming in at EUR 214.6 billion, and also up 3 percent relative to January 2017.

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