Global foreign exchange markets have reached a new record level in daily trading volume, amid rising volatility caused by the tariff war ignited by U.S. President Donald Trump.
The Bank for International Settlements, in a report published every three years, stated that the average daily turnover in global foreign exchange markets reached $9.6 trillion in April, compared to $7.5 trillion in the same month of 2022.
The report, released on Tuesday, noted that the United Kingdom maintained its position as the largest global center for currency trading, accounting for 38% of daily activity in April.
The bank, known as the “central banks’ bank,” pointed out that the increase in trading volume coincided with heightened exchange rate volatility and growing hedging activities following U.S. trade policy announcements.
Currency swap transactions (FX Swaps) made up the largest share of daily trading, valued at $4 trillion, while the share of futures contracts rose to 19% of total trading, compared to 15% three years ago.
Additionally, the volume of currency options doubled to 7% of total transactions, indicating increased demand for hedging instruments. Despite this diversity, the report confirmed the continued dominance of the U.S. dollar in foreign exchange markets.
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