Currency trading up 20 per cent in three years
Currency trading has boomed.
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Thursday, 02, Sep 2010 01:18
By Chris Malone
There has been a large increase in the trading of foreign currency over the past few years, new research has shown.
According to a three-year study by the Bank for International Settlements (BIS), trading has grown by 20 per cent worldwide since 2007.
Approximately $4 trillion (£2.6 trillion) was traded every day across the globe in April 2010, which compares to just $3.3 trillion three years earlier.
The epicentre of activity seems to be in the UK, with London noting a 25 per cent increase during the same period.
One reason for the growth was the 48 per cent increase in turnover of spot transactions from $1 trillion to $1.5 trillion.
The 'other financial institutions' sector of the market, which includes hedge funds, non-reporting banks, insurance companies, central banks and mutual funds, saw turnover increase by 42 per cent to $1.9 trillion from $1.3 trillion.
Meanwhile, cross border transactions represented 65 per cent of trading in April this year, which may perhaps signal that the market is becoming more globalised.
In other news, the BIS yesterday published its International Journal of Central Banking - a quarterly finance publication.