UPDATE 1-FX volumes drop as Fed weighs, manipulation probe lurks

Thu Nov 7, 2013 10:57am EST
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By Jamie McGeever and Jessica Mortimer

LONDON Nov 7 (Reuters) - Daily spot foreign exchange trading volumes on Thomson Reuters dealing platforms fell in October, reflecting a broad decline in turnover across the world's largest financial market, company data showed on Thursday.

The decline in volume follows the Federal Reserve's surprise decision not to start withdrawing its monetary stimulus, and comes against the background of the global investigation into alleged FX manipulation rates.

The average $97 billion traded across Thomson Reuters' main trading services, including Dealing and Matching, was the lowest since the data series began almost four years ago in January 2010.

Average daily spot volumes were $97 billion in October, down 11.8 percent from $110 billion in September and down 19.1 percent from $120 billion the same month last year.

On FXall, the electronic foreign exchange platform purchased by Thomson Reuters last year, average daily volumes fell 4.5 percent to $106 billion in October from $111 billion in September. Volumes were up 12.8 percent from October 2012 when they were at $94 billion.

Earlier this week, EBS, which competes with Thomson Reuters in the FX dealing business and is owned by ICAP, said volumes fell 5 percent to $77 billion in October from $81.2 billion in September and were 17 percent down on the year.

EBS is the leading liquidity provider for the euro , the yen and the Swiss franc.   Continued...