Singapore FX market riding high on world events
The southeast Asian FX market is on fire and it is set to get a further boost thanks to a combination of political and economic turbulence, a regulator committed to facilitating infrastructure investment and increased interest from non-bank market makers.
In June, the Singapore Exchange (SGX) recorded unprecedented levels of forex futures trading, while Investment Trends’ 2017 Singapore contracts for difference (CFD) and FX report refers to a 7% increase in the number of active CFD/FX traders last year compared with 2016.
Jeff Ward, global head of non-deliverable forwards and forwards, and head of FX Asia at NEX Markets, observes that a number of geopolitical and macro-economic events have driven currency volumes on the SGX.
Among them: talk of trade wars between China and the US; plus the recent strength of the US economy and rising US interest rates strengthening the dollar and making yields in emerging markets (EMs) less attractive, further weakening Asian EM pairs.