Japan’s evergreen retail FX industry soldiered on unhindered by the milestone mid-January event which blighted many Western companies, a matter clearly marked by Japan’s 57 retail FX companies having recorded a combined OTC FX volume of ¥662 trillion, ($5.6 trillion), according to statistics published today by the Financial Futures Association of Japan (FFAJ).
Retail FX order flow within the domestic Japanese market accounts for between 30% and 40% of all retail FX trading globally, with the vast majority of traders in Japan placing their business solely with Japanese companies.
Evidence of a month of very high volumes among Japanese FX companies began to make its presence felt when GMO Click Securities announced its volume figures for January 2015, which stood at $1.2 trillion, which at the time of announcement set a record monthly volume figure for any retail FX company across all jurisdictions.
GMO Click Securities has, along with compatriot DMM Securities, enjoyed extended periods of high volumes. Last summer, the firm reported several consecutive months in which combined volumes exceeded $1 trillion, a level to which the company returned at the end of last year.
Testifying to the strength and stability of Japan’s FX market, the FFAJ report states that OTC FX margin trading volume of January exceeded the 600 trillion yen for two consecutive months, January’s figures representing a record in monthly volume.
The open positions of the end of the month had increased while January’s turmoil in the foreign exchange markets affected the retail margin FX trading, although clearly there were no casualties as there were in other markets.
The Yen short positions of the end of the month increased by 750 billion yen compared to the previous month. In contrast the Yen long positions decreased by 500 billion yen. This indicates that Japanese traders expect the Yen to continue to fall in value.