Recent US dollar strengthening in response to the escalating conflict in Iran has done little to temper many investors’ long-term bearish views on the greenback, with some buying into trades anticipating a rally in higher-yielding currencies. The US dollar index (DXY), a measure of the dollar’s value against a basket of currencies, hit 99.683 on […]
Citi was the top US dealer for foreign exchange trading revenues in 2025 on the back of increased client hedging demand, according to regulatory filings. The bank generated revenues of $7.9 billion for the year, up 50% from $5.3 billion in 2024, helped by a bumper second quarter from Donald Trump’s Liberation Day tariff announcements.
Over the past year, State Street has expanded its solutions delivery across several areas in response to client demand, evolving market conditions, and shifts in how institutional investors perceive and manage currency risk. The buy side drove significant change to its hedging programmes in support of new products and in reassessing the operational demands of managing
Will lifer exodus kill Taiwan’s NDF market? – FX Markets Skip to main content End of drawer navigation content Traders split over whether insurers’ retreat from FX hedging is help or hindrance The Taiwan dollar non-deliverable forward (NDF) market is the second largest in the world. But dig beneath the surface and the market has
Why FX liquidity is harder to read than ever – FX Markets Skip to main content End of drawer navigation content A breakdown of FX execution methods shows how liquidity is truly formed, writes Isomiq’s Jamie Rose The BIS Triennial Survey headline for April 2025 is something that has been widely publicised and talked about:
US mutual funds slash short euro positions at record pace – FX Markets Skip to main content End of drawer navigation content Counterparty Radar: Pimco cut $4.6bn of EUR/USD puts in Q3 amid changing stance on dollar direction US mutual fund and exchange-traded fund managers cut $7 billion of euro/US dollar FX options positions during
Vendor says automated data collection and cleaning helps corporates plan better hedges, with unexplained P&L moves cut by 87% When a corporate treasury is working out its foreign exchange hedging strategy, it needs to consult forecasted cashflows and revenues, as well as billing and invoices in foreign currencies. But this data is often messy, residing
Rollercoaster year for FX traders ends with G10 volatility and hedging flows back where they started Source link
A surge in uncollateralised foreign exchange forwards hedging from buy-side clients could put bank balance sheets under pressure, dealers warn. FX hedge ratios at asset managers and pension funds have not materially increased in 2025, despite the selloff in the US dollar in the second quarter. This may change, though, as narrowing interest rate differentials could
Interbank foreign exchange swaps trading has stagnated since 2022, as banks turn to the forwards market for their short-term liquidity needs, according to the Bank for International Settlements. FX swaps remain the largest segment of the FX market with average turnover of $4 trillion a day as of April 2025, a rise of 6% since
The largest counterparties for complex foreign exchange options are typically the leading multi-strategy and macro hedge funds that place big bets on the direction of currency pairs. But there is one corporate whose use of FX options is so extensive that it is connected to most of the top dealers on the Street, regularly buying
As hedge funds have ballooned in recent years, so has their footprint in the few markets large enough to accommodate them. This isn’t a problem when their trades are going well. When those trades backfire, though, it can be a different story – particularly if multiple funds are holding the same position and all try
As developed countries continue to rack up deficits, the big question looming over markets is, who will buy the growing pile of sovereign debt? Hossein Zaimi, global head of macro at Barclays, doesn’t have the answer, but he is pretty sure the prevailing view in financial and government circles is wrong. “The sustainability of the
Investors hope US rate cuts will lower FX hedging costs – FX Markets Skip to main content End of drawer navigation content European investors in US assets set to boost hedge ratios as implied yields rise As the US dollar has continued its fall after April’s tariff turmoil, foreign investors in US assets have had
Amid the ongoing US-China trade war this year, Chinese exporters chose to hold steady on their hedge ratios, according to dealers, owing to high hedging costs and expectations of a stable spot rate. Exporters accumulate US dollars from foreign sales, and many have held on to those dollars in anticipation of continued strengthening against the
Foreign exchange structurers are seeing increased demand from US corporates for options-based hedges that can limit losses on their net investment hedges caused by the US dollar’s selloff. While the economic value of derivatives hedges offsets changes in foreign assets, when those positions hit maturity companies can face hefty mark-to-market payments. Bank structurers, though, say
The deal contingent (DC) hedge market has been making a comeback, after President Trump’s chaotic tariff policies in April led to a sharp dropoff in public merger deal activity amid the widespread economic uncertainty. “The tariff discussions and news flow saw a lot of timelines pushed out, but I feel deals are coming back in
