Foreign Exchange Market Activity(国际金融-香港大学,WONG Ka Fu).pptVIP

Foreign Exchange Market Activity WONG Ka Fu 23rd February 2000 Based onCentral Bank Survey of Foreign Exchange and Derivatives Market Activity (1998) Background about the BIS survey BIS started to conduct the triennial survey of foreign exchange market activity since 1986. In April 1998, 43 central banks and monetary authorities participated in the survey. The coverage was estimated to have reached 90% or more of turnover. Table A1: Foreign exchange market turnover (Adjusted for local and cross-border double-counting)Daily averages in billions of US dollars Currency composition In 1998, the US dollar was once again by far the most actively traded currency, being involved in 87% of all transactions worldwide, compared with 83% in 1995. The US currency continued to benefit from its predominance in commercial relations and market liquidity. The US dollar was used in seven of the ten most heavily traded currency pairs, partly due to its use as a vehicle currency for cross-trading between other currencies. In many currency pairs involving the US dollar, foreign swaps account for two-thirds or more of turnover, reflecting the standard practice of using the US dollar as a conduit when swapping into or out of third currencies. Foreign exchange brokers (UK) In the UK market, the proportion of total foreign exchange business transacted by brokers fell from 35% in 1995 to 27% in 1998, the remainder being conducted bilaterally between counter-parties. Electronic brokers increased their share of total foreign exchange turnover from 5% in 1995 to 11% in 1998. In consequence, the proportion of business conducted by traditional voice brokers, who quote prices over telephone lines to dealing rooms, declined from 30% to 16%. Electronic brokers now handle almost one quarter of total spot transactions in the UK market. While a wider range of currency pairs and products is available, spot trading of the US dollar/ Deutsche mark and US dollar/ Japanese yen still accounts for m