CLS FX volume continues downward trend in August

abdelaziz Fathi

Total daily traded volume submitted to CLS for settlement took yet another step back in August.

In particular, the average daily traded volume submitted to the FX settlement specialist was $1.77 trillion last month, down 5.3 percent from $1.87 trillion in July 2022. Across a yearly timetable, the figure reflected an increase of 6 percent relative to August 2021’s $1.67 trillion.

Following a period of wide-scale volatility and increased trading activity during the initial phase of the Russo-Ukrainian war, average daily traded volumes in CLSSettlement, a payment-versus-payment settlement service, have now stabilized at lower volumes as compared to the first quarter.

CLS reported swaps volumes at $1.22 trillion in August 2022, down 4 percent from $1.26 trillion in July 2022. Further, the figure was slightly lower year-over-year from $1.23 trillion a year ago.

In terms of CLS’ spot FX volume, the group has reported the figure at $429 billion in August 2022 compared to $471 billion in July. Additionally, the figure was higher 17 percent over a yearly basis from the $369 billion set in the previous year.

Although monthly comparisons are always vulnerable to short-term fluctuations, there was a longer-term trend of higher spot volumes. However, the curve of this increase seems to have flattened in recent months.

The mixed performance was again pronounced across CLS forwards business, which yielded a figure of $118 billion last month. That was down 15 percent over a monthly basis from $140 billion in July, but rose by 49 percent year-over-year from $79 billion in August 2021.

“In August 2022, we saw average daily traded volumes of USD1.77 trillion, an increase of 6% compared to August 2021. Over the same period, FX forward and spot volumes were up significantly – by 49% and 17%, respectively – while FX swap volumes remained flat,” said CLS’s Global Head of Product, Keith Tippell.

We last reported on CLS Group earlier this month when it announced that CLSNet, its foreign exchange bilateral payment netting system for emerging currencies, platform witnessed continued growth.

In August 2022, the group reported a record $100 billion in the average daily notional of net calculations in CLSNet. The milestone marks an increased adoption from market participants and follows the 179% year-on-year increase in the average daily notional of net calculations in H1 2022.

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