CLS Group Reports 12pct Drop in Spot FX Volumes for August 2021

abdelaziz Fathi

FX settlement specialist CLS Group today reported that the executed volumes of currency trading on its platforms were slightly down in August.

Currency derivatives volumes explode in 2015

In particular, the average daily traded volume submitted to CLS was $1.66 trillion last month, down -3.8 percent month-over-month from $1.74 trillion in July 2021. Across a yearly timetable, the figure reflected a rise of 1 percent relative to August 2020’s figures.

Following a period of wide-scale volatility and increased trading activity during the initial phase of the COVID-19 pandemic, average daily traded volumes in CLSSettlement, a payment-versus-payment settlement service, have now stabilized at lower volumes as compared to the first half.

CLS reported swaps volumes at $1.23 trillion in August 2021, down from $1.24 trillion in July 2021. Further, the figure was higher by a factor of 3.5 percent year-over-year from $1.19 trillion a year ago.

In terms of CLS’ spot FX volume, the group has reported the figure at $367 billion in August 2021, down 12.6 percent from $420 billion in July. Additionally, the figure was lower 5.2 percent over a yearly basis from the $387 billion set in the previous year.

The mixed performance was again pronounced across CLS forwards business, which yielded a figure of $79 billion last month. That was down 21 percent over a monthly basis from $84 billion in July, but was up by 1.3 percent year-over-year from $78 billion in August 2020.

“Monthly comparisons, such as those above, are always vulnerable to short-term fluctuations (in either the current or comparison month). There is a longer-term trend of declining spot volumes (although this decline seems to have flattened in recent months), but growing FX swap activity,” the company explains.

CLS figures reflect the trend observed in the monthly figures from major trading platforms, which have seen record-breaking volumes in the first quarter before turning to suffer lackluster activity. But after several flat months, the latest metrics from major institutional spot FX platforms show the FX market has bounced back with slight jumps in daily trading volumes.

“In August 2021, we saw average daily traded volumes of USD1.67 trillion, an increase of 1% compared to August 2020. Changes varied by instrument; FX forward and FX swap volumes were up 2% and 4%, respectively, while FX spot volumes were down 5%,” said CLS’s Global Head of Product, Keith Tippell.

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