The study analyses over-the-counter (OTC) derivatives trading in 13 Asia-Pacific countries – Australia, China, Chinese Taipei, Hong Kong, India, Indonesia, Japan, Malaysia, New Zealand, Philippines, Singapore, South Korea and Thailand. The analysis is based on data from the Bank for International Settlements (BIS) Triennial Central Bank Survey of foreign exchange and OTC derivatives markets, and focuses mainly on FX and interest rate derivatives (IRD).
Highlights of the report include:
- Derivatives markets have grown markedly in Asia-Pacific in the past decade, with Hong Kong and Singapore now pre-eminent in regional trading of FX and IRD. Total IRD daily average turnover in Asia-Pacific markets increased to $298.3 billion in April 2016 from $187.4 billion in April 2007, while the equivalent figure in FX increased to $1.7 trillion from $1 trillion.
- Between 2007 and 2016, IRD turnover in Asia-Pacific markets grew at 5% compound annual growth rate (CAGR), while FX turnover grew at 6%. Global IRD and FX turnover grew at 4% and 5% CAGR, respectively, over the same period.
- Despite the increasing trading activity in Asia-Pacific markets, the trading volumes in those markets still remain low as a percentage of global trading volumes. For example, Hong Kong, the largest Asia-Pacific market by IRD trading activity on a net-gross basis, had only a 3.6% global market share, while the US and the European Union (EU) accounted for 40.8% and 47.5%, respectively, of global daily average IRD turnover in April 2016.
Click here to download the report.