FX volume drops 13pct at CLS Group in April 2022

abdelaziz Fathi

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

In particular, the average daily traded volume submitted to CLS was $1.85 trillion last month, down -13 percent month-over-month from $2.12 trillion in March 2022. Across a yearly timetable, however, the figure reflected an increase of 5 percent relative to April 2021’s $1.77 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 $1.26 trillion in April 2022, down from a record of $1.45 trillion in March 2022. Further, the figure was slightly lower year-over-year from $1.27 trillion a year ago.

Russian invasion left financial markets jittery

In terms of CLS’ spot FX volume, the group has reported the figure at $475 billion in April 2022, down 14 percent from $550 billion in March. Additionally, the figure was higher 14 percent over a yearly basis from the $416 billion set in the previous year.

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

The weak performance was again pronounced across CLS forwards business, which yielded a figure of $115 billion last month. That was down 8 percent over a monthly basis from $125 billion in March, but was up by 26 percent year-over-year from $91 billion in April 2021.

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 FX platforms show the FX market has bounced back with slight jumps in daily trading volumes.

“In April 2022, we saw average daily traded volumes of USD1.86 trillion, an increase of 5% compared to April 2021. Over the same period, FX spot volumes and FX forward volumes were up by 14% and 27%, respectively, and FX swap volumes remained flat,” said CLS’s Global Head of Product, Keith Tippell.

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