Press release

Results of the Semi-annual Survey of Foreign Exchange and

Interest Rate Market Activity in Hong Kong (October 2017)

The Treasury Markets Association (TMA) announced today (Thursday) the results of the Semi-annual Survey of Foreign Exchange and Interest Rate Market Activity in Hong Kong in October 2017, which covers turnover in both FX transactions and over-the-counter (OTC) interest rate derivatives transactions.  The TMA conducted the semi-annual survey to increase the transparency of the Hong Kong foreign exchange and over-the-counter interest rate derivatives market.

The semi-annual survey is developed based on the Bank for International Settlements triennial survey on foreign exchange and derivatives market turnover [1], but with simplified reporting requirements.  Reporting basis of the semi-annual survey is the same as that of the triennial survey, i.e. primarily the location of the sales desk servicing the transactions.  The 59 financial institutions (comprising 55 authorized institutions and 4 licensed corporations) taking part in the triennial survey in April 2016 participated in the semi-annual survey in October 2017.  To safeguard data confidentiality, the Hong Kong Monetary Authority provided support in data handling and survey administration.

Foreign exchange turnover

In October 2017, average daily turnover of foreign exchange transactions increased by 2.7% to US$418.4 billion, as compared with the results of the survey for April 2017.  The growth was driven by increases in foreign exchange swaps and currency swaps, which were partly offset by a modest decline in FX spot trades.  Hong Kong dollar and US dollar has become the most heavily traded currency pair in the Hong Kong market, followed by US dollar and Renminbi, and then US dollar and Japanese yen.

Interest rate market turnover

In October 2017, average daily turnover of interest rate derivatives increased by 82.1% to US$155.8 billion, as compared with the results of the survey for April 2017.  The growth was mainly driven by an increase in interest rate swaps, which was in large part due to an increase in hedging trades.  Trading was most active in contracts denominated in US dollar, followed by Australian dollar and then Hong Kong dollar.

Annex

The TMA collaborated with the Australian Foreign Exchange Committee, the Canadian Foreign Exchange Committee, the New York Foreign Exchange Committee, the Singapore Foreign Exchange Market Committee, the Tokyo Foreign Exchange Market Committee, and the United Kingdom’s Foreign Exchange Joint Standing Committee, which conducted similar surveys over the same time period for respective markets.  The results of their surveys can be found at

https://www.afxc.rba.gov.au/statistics

https://www.cfec.ca/fx_volume.html

https://www.newyorkfed.org/fxc/volumesurvey/

https://www.sfemc.org/statistics.asp

https://www.fxcomtky.com/index_e.html

https://www.bankofengland.co.uk/markets/london-foreign-exchange-joint-standing-committee

Treasury Markets Association

25 January 2018

[1] The Hong Kong result of the April 2016 Bank for International Settlements triennial survey can be found at https://www.hkma.gov.hk/eng/key-information/press-releases/2016/20160901-3.shtml