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Tuesday June 6, 6:28 PMFX volume at $3 trln daily by 2010-ClientKnowledgeLONDON, June 6 (Reuters) - Daily average turnover in the foreign exchanges will exceed $3 trillion by 2010, a rise of more than 50 percent from most recent official figures, according to research published on Tuesday.The rise in volume is likely to be led by growth in emerging market currencies and hedge fund and other highly-active investor activity, client strategy firm ClientKnowledge said in a report. "The recent growth in the foreign exchange market is sustainable and will extend further over the next five years," said Justyn Trenner, CEO at ClientKnowledge. ClientKnowledge reckoned daily turnover at $2.3 trillion currently, compared with $1.9 trillion calculated by the Bank for International Setttlements in its most recent triennial survey in 2004. Volume data in the largely over-the-counter foreign exchange market is hard to find outside the BIS survey, but anecdotal evidence has suggested strong growth in recent years, led by an increase in hedge fund activity. ClientKnowledge said Brazil, Russia, India and China were likely to have the fastest growing currency trading volume over the next four years. "The key ingredient to support the continued expansion of the forex market is global economic growth." The interbank market accounted for around half of overall volume currently, mostly traded via electronic trading services like Reuters and EBS, ClientKnowledge said. Around 25 percent of the market is made up of client banks, corporates or retail, and the remaining 25 percent with hedge funds and traditional money managers. ClientKnowledge also said increasing electronic trading business would encourage overall volume to grow. Currently, around 50 percent of client business is conducted electronically, through single-bank or multi-bank platforms. This will rise to more than 75 percent by 2010, ClientKnowledge forecast. |
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