Big FX platforms see e-trading volumes drop over past three years - BIS

In its quarterly report, the Bank for International Settlements (BIS) revealed that falling market volatility has prompted some global banks to route more volumes onto their internal platforms, which has led to a drop-in turnover on some of the world’s biggest currency-trading platforms over the past three years.

Key Quotes (via Reuters):

“Electronic trading between banks on the world’s biggest platforms — owned by Refinitiv, partly owned by Thomson Reuters and EBS, part of the CME Group, among others — has fallen by 7% to $368 billion per day in 2019 from a similar survey three years ago.

The BIS, known as the central bankers’ bank, noted these electronic inter-dealer brokerage systems, which are central to FX trading, now constitute only for a small portion of the turnover in the market even though they remain essential in price discovery.

This trend has also been helped by a drop in currency market volatility to record lows. For example, trading ranges in the euro/dollar last week, the world's most actively traded currency pair, was the narrowest in two decades.”

The BIS said: The falling share of inter-dealer trading has gone hand-in-hand with a handful of banks coming to dominate FX volumes.