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Screenshot of a breaking news alert e-mail from Q2 2017
A clear indicator that this year’s long period of low volumes which so many FX companies have experienced is perhaps starting to subside manifests itself in the vast increase in exchange-traded margin FX contracts at Japan’s Tokyo Exchange.
Today, the prominent venue has announced that trading volume in Click 365 Exchange FX Margin contracts during September was 3,259,250, representing a stratospheric increase of 65.6% from August this year, and an 8.5% increase compared with September last year, the month which signaled the end of a summer of record trading volumes for firms in Japan and beyond.
Whilst demand for some currency pairs has dwindled, Japanese traders had developed a penchant for the Canadian dollar in September, with trading activity for the JPY/CAD pair accelerating by 236%.
During September, average daily trading volume for Click 365 was 148,147 contracts, representing more than twice the trading activity each day compared with August 2014, in which 74,384 contracts were traded. Whilst a steady increase of 15% over July was experienced in August this year, the firm’s results were still considerably short of the high points of one year ago, however September has shown that Japanese investors are gaining confidence rapidly, a very poignant measure as to the recovery which lies ahead, as the Japanese market accounts for approximately 30% of global retail FX order flow, and is home to a notoriously conservative client base.
In western markets, a similar dynamic emerged during September, with KCG Holdings’ Hotspot FX division having reported record trading volumes for the month, adding to the notion that there is light at the end of what had become a very long tunnel.
For the full release from Tokyo Financial Exchange, click here.