April 2016 Forex Industry Metrics: Mixed Results

After a bit of a rough time in March, the forex industry had a pretty shaky recovery in April based on trading volumes from a few brokers and exchanges. Are the summer doldrums starting to set in?

International derivatives marketplace CME Group reported a 15.5% slump in the average daily volume (ADV) of FX contracts for April, following the 4.4% decline seen during the previous month. This brings the April 2016 ADV lower by 8% compared to the same month a year ago.

For institutional forex platform FastMatch, on the other hand, trading volumes rose in monthly and annual terms. The ADV rose to $10.8 billion in April, which represents a 6.9% gain from March and a 35% jump from April 2015. Interestingly enough, the group also reported that the strongest day for trading activity was in April 28. Care to recall what happened then? (Here’s the answer!)

Meanwhile, Japan’s Tokyo Financial Exchange reported a smaller decline of 7.9% in monthly trading volumes for April compared to the jaw-dropping 23.1% drop seen in March. Total trading volumes based on Click365 forex contracts showed that monthly activity picked up the most for CAD/JPY and  CHF/JPY while volumes slumped greatly for EUR/USD and GBP/USD.

Data from the Tokyo Financial Exchange

A quick review of the main market themes that drove forex price action in April reveals that speculations for additional BOJ easing were in play for most of the month only to have yen bears sorely disappointed once the actual statement was made. Jawboning from Japanese officials and their lack of action also played a role in spurring volatility for yen pairs then.

As for brokers’ April metrics, the numbers are looking mixed so far. Interactive Brokers showed a small 1% gain in daily average revenue trades (DARTs) for the month, 5% higher than the same month last year. Meanwhile, Hotspot FX reported that April 2016 trading volumes were virtually unchanged at an ADV of $25.6 billion, down 10% from April 2015.

With central bank action heating up this month, do you think we’ll see more volatility and higher volumes in the forex arena? Don’t be shy to share your thoughts in our comments section below!