Still, if investors wanted to know what they were missing while London was enjoying the traditional holiday rain on Monday,then a report this week revealed how the city has extended its dominance in the currency markets. UK lobby group TheCityUK produced a report that put together various central-bank turnover figures to estimate that the global FX market had average daily turnover of $4.9 trillion – $2 trillion of which it reckons goes through London.
Part of London’s appeal comes from its role as a bridge between the east and west, and while apprehension ahead of Bernanke kept things quiet across the Atlantic, it was a different story for those venturing in the other direction.
Looking east
There has been much focus on a slowdown in China. We took a look this week at what that means for the AUD, the world’s favourite China proxy, and how the Reserve Bank of Australia might respond to stubborn demand for its currency from the world’s reserve managers.
We also reported on how expectations for weakness in the renminbi could affect Beijing’s plans to internationalize its currency.
Talking of which, this week brought news of a deal between China and Taiwan for a renminbi clearing system. That promises to introduce CNT – Taiwan-cleared offshore renminbi – to sit alongside the well-established CNH – Hong Kong-cleared offshore renminbi - in the expanding pantheon of currency acronyms.
There was also more news of the rise of the renminbi from Swiftand Deutsche Bank, which both revealed increased use of the currency for trade settlement.
Meanwhile, the industry continues to look ahead to potential regulatory changes.
Robert Pickel, CEO of the International Swaps and Derivatives Association, told us this week how new rules will make the market for cleared FX futures and options more efficient.
Elsewhere, the summer jobs market showed little sign of slowing down at leading FX institutions, with a number of interesting moves.
We, however, expect more action next week as the market returns to full strength after what has been an unexpectedly lively summer.