August 2024 witnessed a surge in institutional spot FX trading volumes, driven by a weakened dollar and heightened market volatility. Major trading platforms reported notable increases in activity, with several experiencing double-digit growth compared to the previous year.
Dollar Weakness Fuels Market Activity
The U.S. dollar’s decline to its lowest levels in over a year against key currencies such as the euro, pound, and yen, created a volatile environment in the forex market throughout August. This environment spurred a rise in institutional spot trading volumes across global trading venues, marking a consecutive month of growth.
Rising Spot FX Volumes in August 2024
Significant increases were recorded in Forex daily futures contracts on the Tokyo Financial Exchange (TFX). The Click 365 platform reported trading volumes exceeding 2.9 million contracts in August, with an average daily volume (ADV) of 131,920. This represents a 5.6% increase compared to July’s figures and an impressive 26% jump year-over-year.
The USD/JPY currency pair maintained its leading position in terms of turnover, accounting for 0.9 million of all August contracts. This was a substantial increase both on a monthly basis (21%) and compared to the same period last year (24%).
The U.S. market also experienced a rise in FX trading activity. Cboe reported an increase in spot volumes to $1.1 trillion in August, up from $1.02 trillion in July. Despite fewer trading days in August (22 vs. 23), the average daily volume (ADVC) climbed from $44 billion to nearly $50 billion.
Strong FX Volumes in Europe
Europe also saw robust FX trading activity during August. On the German stock exchange-owned 360T platform, while total monthly volumes dipped from $707 billion to $682 billion, the ADV rose to over $31 billion, up from $30.8 billion in July, largely due to the reduced number of trading days.
At Euronext FX, both total and daily volumes showed an upward trend. August’s investor activity on the platform reached $638 billion, an increase from July’s $583 billion. The ADV also saw a rise, climbing to $29 billion from $28 billion in the previous month.
These results are notably stronger compared to the previous year. In August 2023, Euronext FX recorded a monthly volume of $518 billion, while 360T reported $508 billion, underscoring the significant growth in institutional FX trading amid the current market conditions.
