CME Group, which runs the world’s largest derivatives marketplace, announced today that FX volumes (mainly Eurodollar futures contracts) in its system fell by 7% in March (as compared to last year), and by 12% overall in Q1. This is the first indication that a pickup in Forex trading levels from very slow activity late last year might not yet be happening. We should learn more when Forex ECNs such as ICAP, Hotspot FX and FXall release March (and Q1 total) numbers in the coming weeks. Stay tuned…
Separately, CME also announced that they had acquired “green exchange” company GreenX. GreenX is one of the largest carbon exchanges in the world, a rapidly growing space. CME was already one of GreenX’s shareholders, and the deal (no total size given) basically sees CME buy out its partners in GreenX, such as Goldman Sachs, Constellation Energy, Credit Suisse, ICAP and Morgan Stanley, and integrate GreenX into its energy business.
The upshot for retail FX / CFD traders? As more and more “exotic” instruments, such as carbon, become more and more standardized, and as liquidity in these instruments become aggregated and centralized, it will eventually provide the opportunity for retail FX brokers to tap into this liquidity and offer such products to their retail client base.