Bank survey of foreign exchange and derivatives market activity in Germany

In April 2010, the central banks of 53 countries – including all major financial centres – carried out a survey of foreign exchange and derivatives market activity. In consultation with the Bank for International Settlements (BIS), these surveys have been carried out every three years since 1989. Their objective is to provide comprehensive and internationally comparable data on the scope and structure of global foreign exchange markets in order to gain a better understanding of the financial markets. In Germany, the Bundesbank surveyed 25 large banks which account for around 90% of domestic foreign exchange trading and derivatives transactions. The participating countries and the BIS publish the results of the survey at the same time, showing both national and global data.

1 Foreign exchange market turnover in Germany

For the month of April 2010, the banks reported turnover in foreign exchange spot and forward contracts concluded in Germany amounting to a total of US$2,171 billion. As a trading centre, Germany therefore ranks in the top third in an international comparison. Given 20 trading days in April 2010, this works out at an average daily turnover of US$108 billion, of which US$30 billion was accounted for by spot transactions and US$78 billion by forward contracts (outright forwards, foreign exchange swaps, currency swaps and foreign exchange options).

The daily trading volume was 6% higher than in April 2007. The increase in foreign exchange spot transactions was more pronounced than that of forward contracts, which rose only slightly. Developments in Germany are therefore broadly parallel to the global trend identified by the Bank for International Settlements.

The relative importance of the currencies traded was virtually unchanged from April 2007. The euro made up 63% of turnover, while the combination euro/US dollar accounted for nearly half (44%) of all turnover. In a further 19% of transactions, the euro was exchanged against other currencies. In 34% of transactions, the US dollar was exchanged against other currencies. The vast majority of transactions related to turnover with non-residents.

2 OTC trading with interest rate derivatives in Germany

For the survey on the OTC trade in interest rate derivatives, the banks reported on their OTC transactions in interest rate swaps, interest rate options and forward rate agreements in April 2010. With transactions totalling US$969 billion (nominal value), turnover in Germany had almost halved since April 2007 (US$1,715 billion), bucking the global trend of rising turnovers. This was mainly due to changes in the activities of individual large domestic market players.

3 Global results

Simultaneously with the national central banks, the BIS is today publishing the aggregated global results of the survey from all the participating countries (see In these results, double counting of cross-border transactions is eliminated in order to allow an accurate appraisal of the total volume of international foreign exchange trading and derivatives business.