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Why has global FX turnover declined? Explaining the 2001 triennial survey

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  • Gabriele Galati

Abstract

The 2001 Triennial Central Bank Survey of Foreign Exchange and Derivatives Market Activity showed that foreign exchange market turnover declined substantially between 1998 and 2001. In April 2001, average daily turnover in traditional foreign exchange markets was $1,210 billion, compared to $1,490 billion in April 1998. This represented a 19% decline at current exchange rates and a 14% fall when volumes are measured at constant exchange rates (Table 1). The decline in turnover over the last three years contrasts with the findings of previous surveys, which had reported a rapid rise in forex market activity.

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  • Gabriele Galati, 2001. "Why has global FX turnover declined? Explaining the 2001 triennial survey," BIS Quarterly Review, Bank for International Settlements, December.
    • Handle: RePEc:bis:bisqtr:0112e
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    References listed on IDEAS

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    1. Robert N. McCauley, 1997. "The euro and the dollar," BIS Working Papers 50, Bank for International Settlements.
    2. Claudio Borio, 2000. "Market liquidity and stress: selected issues and policy implications," BIS Quarterly Review, Bank for International Settlements, November.
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    Cited by:

    1. Gabriele Galati & William Melick, 2002. "Central bank intervention and market expectations," BIS Papers, Bank for International Settlements, number 10.
    2. Rime, Dagfinn & Sarno, Lucio & Sojli, Elvira, 2010. "Exchange rate forecasting, order flow and macroeconomic information," Journal of International Economics, Elsevier, vol. 80(1), pages 72-88, January.
    3. Eichengreen, Barry & Lafarguette, Romain & Mehl, Arnaud & Ferrari Minesso, Massimo, 2023. "Technology and the geography of the foreign exchange market," Journal of International Money and Finance, Elsevier, vol. 131(C).
    4. Tsuyuguchi, Yosuke & Wooldridge, Philip D., 2008. "The evolution of trading activity in Asian foreign exchange markets," Emerging Markets Review, Elsevier, vol. 9(4), pages 231-246, December.
    5. Paola Gallardo & Alexandra Heath, 2009. "Execution methods in foreign exchange markets," BIS Quarterly Review, Bank for International Settlements, March.
    6. Alain Chaboud & Steven Weinberg, 2002. "Foreign exchange markets in the 1990s: intraday market volatility and the growth of electronic trading," BIS Papers chapters, in: Bank for International Settlements (ed.), Market functioning and central bank policy, volume 12, pages 138-147, Bank for International Settlements.
    7. Gabriele Galati & Kostas Tsatsaronis, 2003. "The impact of the euro on Europe's financial markets," Financial Markets, Institutions & Instruments, John Wiley & Sons, vol. 12(3), pages 165-222, August.
    8. Eichengreen, Barry & Mehl, Arnaud & Lafarguette, Romain, 2016. "Cables, Sharks and Servers: Technology and the Geography of the Foreign Exchange Market," CEPR Discussion Papers 11053, C.E.P.R. Discussion Papers.
    9. Andrew Sheng, 2012. "Opening remarks," BIS Papers chapters, in: Bank for International Settlements (ed.), Financial sector regulation for growth, equity and stability, volume 62, pages 41-44, Bank for International Settlements.
    10. Guy Debelle & Jacob Gyntelberg & Michael Plumb, 2006. "Forward currency markets in Asia: lessons from the Australian experience," BIS Quarterly Review, Bank for International Settlements, September.
    11. Philip Wooldridge, 2002. "Uses of the BIS statistics: an introduction," BIS Quarterly Review, Bank for International Settlements, March.
    12. Ledenyov, Dimitri O. & Ledenyov, Viktor O., 2015. "Wave function method to forecast foreign currencies exchange rates at ultra high frequency electronic trading in foreign currencies exchange markets," MPRA Paper 67470, University Library of Munich, Germany.
    13. Patrick McGuire, 2004. "A shift in London's eurodollar market," BIS Quarterly Review, Bank for International Settlements, September.
    14. Bank for International Settlements, 2003. "Guide to the international financial statistics," BIS Papers, Bank for International Settlements, number 14.
    15. Gabriele Galati & Michael Melvin, 2004. "Why has FX trading surged?," BIS Quarterly Review, Bank for International Settlements, December.
    16. Frank Moss, 2011. "The euro: internationalised at birth," BIS Papers chapters, in: Bank for International Settlements (ed.), Currency internationalisation: lessons from the global financial crisis and prospects for the future in Asia and the Pacific, volume 61, pages 57-74, Bank for International Settlements.

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