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FX volumes also continued its upward route in January as inflation fears, and central banks’ policy reviews sparked a fresh wave of speculation and hedging activity.
Average daily volumes reached RUB 1.28 trillion ($16.8 billion) in the last month, up from RUB 1.25 trillion in December, Moex said in a statement. Year-over-year, the ADV figure was up 6.7 percent from RUB 1.20 trillion ($16.2 billion) in January 2021.
However, MOEX’s total FX market turnover fell to RUB 27.0 trillion ($355 billion) in January 2022, down 15 percent from the RUB 31.9 trillion ($424 billion) exchanged hands in December 2021. Compared with volumes from the same month a year earlier, this figure was up 17 percent when weighed against RUB 22.9 trillion a year earlier.
Delving further into the details, January turnover included spot trades of RUB 10 trillion ($131 billion) and swap trades coming in at RUB 17.0 trillion ($223 billion). That compares with spot trades of RUB 9.5 trillion and swap trades coming in at RUB 22.4 trillion, respectively, the previous month.
The metrics show that spot volumes, in particular, continue to surge, and the momentum seen throughout December had continued into January. On the other side, the drop in MOEX’s FX turnover is primarily caused by the fall in FX swaps, used mostly for liquidity management and hedging of foreign currency portfolios. In 2020, the foreign exchange swaps accounted for nearly 50 percent of the total FX market turnover, according to the BIS triennial survey.
Russia’s largest bourse attributed the growth to its new products and upcoming regulatory changes, which helped increase the share of interest swaps in total market turnover to 40 percent. Moscow Exchange’s derivatives are offering lines up swaps, FX swaps, cross-currency swaps, FX forwards and options with maturities from 3 days to 5 years.
MOEX, in particular, continues to develop its infrastructure as part of a state-backed drive to make Russia’s largest institutional trading venue one of the world’s leading financial hubs.
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