Indian Rupee trades lift DGCX FX volumes in February 2022

abdelaziz Fathi

The Dubai Gold & Commodities Exchange (DGCX) ‎witnessed an uptick in FX trading volumes for the month ‎ending February 2022, driven by increased investor interest in EM currencies.‎

DGCX

UAE’s leading derivatives bourse ‎has recorded an all-time high of $13.68 billion in aggregate volumes as heightened market volatility triggered by the Russian-Ukrainian conflict boosted trading on the exchange. ‎

DGCX’s G6 currencies portfolio recorded year-on-year volume growth percent compared to the same period last year. This surge was led by high levels of volatility, coupled with the need to manage counter-party risk which strengthened the value proposition of exchange based forex futures trading.

DGCX reported a sharp spike in Indian Rupee (INR) trading, with its Rupee mini futures contract, options contract and weekly contracts registering increases in 67%, 206% and 87% respectively. DGCX’s West Texas Intermediary (WTI) Futures also gained traction following increased volatility in oil markets – with a YoY ADV growth of 136%.

British Pound and Euro Futures Contracts were the standout performers, registering  double-digit Average Daily Volume (ADV) growth. The contracts gained traction in the market as investors sought to take the advantage of the trading opportunities that they offered.

The UAE main bourse has maintained its momentum into the new year, as it continues to provide investors with a wide range of derivative products that allow them to manage their risk effectively.

In addition, DGCX successfully launched the region’s first FX Rolling Futures Contracts (Euro, Pound Sterling and Australian Dollar), whilst expanding the range of Indian Rupee/US Dollar contracts with the launch of a Weekly INR-US Dollar Futures Contract.

Many of DGCX’s products are geared towards offshore investors; that is why it often sees spikes of trading activity in Indian referenced contracts. The demand is likely based on the usage of these products for hedging purposes when financial markets are experiencing sharp volatility.

Les Male, CEO of DGCX, said: “Volatility has been a recurring theme over the past few months, with investors and traders continuing to grapple with a range of factors including inflation, oil prices and geo-political developments. Against this backdrop, we have seen our precious metals’ portfolio lead trading activity on the exchange. We have also seen a sharp uptick in Indian Rupee trading as market participants look to hedge their exposure to one of the world’s fastest-growing economies. DGCX remains committed to providing our customers with a broad array of tradable products that meet their hedging and investment needs.”

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