Institutional foreign exchange trading activity suffered a retreat last month after logging strong growth at the beginning of the year. Data showed that average daily volumes decreased by over 3% across major electronic communication networks and multibank trading platforms in February 2024.
FXSpotStream, one of the largest liquidity venues, reported total average daily volumes of $72.3 billion – down 1.8% month-on-month following January’s record levels. Spot trading saw a steeper 5.3% fall though other contracts rose 8.4%.
At Cboe FX, formerly known as HotspotFX, average volumes were $42.6 billion for the month, a 2.3% decline from January. EuronextFX, the owner of FastMatch, recorded $23.6 billion in daily trading, off 5.3% from the previous month.
Additionally, 360T closed February with $27.6 billion in average volumes, representing a 4% drop.
While the pullbacks were modest, the data points to some erosion of risk appetite among institutional FX market participants. Platform owners will hope cross-border currency trading activity stabilizes or rebounds as global economic and political conditions evolve.
