CLS FX trading activity | March 2018

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2 min read
19 April 2018

1.855 USD trillion
Total daily traded volume submitted to CLS
Down 4.8 percent from USD1.949 trillion in February 2018

David Puth

“While February’s volatility caught significant attention, we have observed a strong underlying trend towards higher volumes throughout the first quarter with a record average daily volume in Q1 2018 of USD1.87 trillion, compared to the previous record of USD1.67 trillion in Q1 2013.

“There are a number of drivers that have led to this outcome, not least of which is the rising trend of the buy-side becoming more actively involved in managing settlement risk. Today, most of the world’s largest asset managers use CLS, as clients of our members, to manage settlement exposure. This has materially improved liquidity management while allowing buy-side participants to reduce operational errors in the 18 currencies in which we settle. The additional volume of transactions has had the added benefit of reducing the cost of incremental transactions to all of our clients. In 2017, over 90% of our new business growth came from third party business.

“Having proven that the PvP model can deliver a safer and more stable foreign exchange market, we are also experiencing increased growth and interest for CLS services in new territories. For example, within the last 12 months, we have seen our first ever activity from third party participants in Korea, our first Japanese non-bank financial institution, new activity from Latin America (Columbia and Chile) and we look to welcome our first settlement member bank from Mexico very soon.”

Average daily traded volume
submitted to CLS by product (USD trillion)*
March 2017 February 2018 March 2018
Forward 1.039 1.307 1.272
Swap 0.462 0.542 0.480
Spot 0.095 0.100 0.103
Total average daily traded volume submitted to CLS (USD trillion) 1.596 1.949 1.855

* From January 2017, CLS altered the reporting methodology for the FX data it makes available on a monthly basis. The data provided is based on executed trade volumes submitted to CLS. It is adjusted to equate to the same reporting convention used by the Bank for International Settlements (BIS) and the foreign exchange committees’ semi-annual FX volume surveys. These surveys only report one side of any trade, and only one of the four legs of FX swap trades, to avoid double counting the total amount of trades.

* Due to rounding, numbers presented throughout the document may not add up precisely to the totals provided and percentages may not precisely reflect the exact figures.

Data is available for subscription through Quandl in the form of three separate reports, showing activity by hour, day or month. The data reports contain executed trade volume in terms of both the number of trades and the total value in USD. The data is aggregated by trade instrument (spot, swap and outright forward) and currency pair and can be purchased by subscription by following this link: currency-data_traditional-currencies_volumes.

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