Japan FX volumes come roaring back

GMO Click Securities reports FX volumes 2.5x what they were last December.

As we predicted a few weeks ago, December FX volumes are looking unseasonably warm in Japan, as Yen volatility surrounding the intentions of the new Japanese government has brought traders back to the table.

As is evident from the chart above, trading volumes at GMO Click Securities, Japan’s largest retail FX broker, fell drastically from the beginning of 2009 through to the end of 2011, as leverage limitations imposed by Japan’s financial regulator JFSA came into play, scaring away many traders and lowering volume levels of those who remained (50x in August 2010, and then down to 25x in August 2011, where it remains today).

However GMO Click’s volumes have ticked back up during 2012 to hit ¥31.7 trillion (about $360 billion) in December 2012 — about two and a half times the level they were in December 2011. The increase is in part due to acquisitions GMO Click has made — mainly FX Prime — but also in part due to overall increases in country-wide volumes.

We are always somewhat sceptical of the accuracy of volumes we see reported in Japan, despite the fact that some of those companies reporting them (such as GMO Click) are publicly traded companies. But the trend is quite evident.

For more on the global Forex industry see the LeapRate-Dow Jones Forex Industry Report.

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