In April 2013, the daily turnover in foreign exchange transactions of financial institutions operating in Finland averaged USD 14.9 billion, which was slightly less than half of the average daily turnover in April 2010. Compared to 2010, the largest decline was in foreign exchange swaps, where daily turnover dropped from USD 30 billion to USD 13.5 billion. In contrast, turnover in foreign exchange options and other products nearly quadrupled. Foreign exchange transactions also decreased in the other Nordic countries, despite the 35% increase in the daily turnover in the global foreign exchange market, to ca USD 5,350 billion. This information comes from a survey by the Bank for International Settlements (BIS).
In Finland, the euro was the most traded currency, followed by the US dollar. The euro was a counterpart currency in 70% of the total turnover in the Finnish foreign exchange market. Globally, the most traded currencies included the US dollar, which was a counterpart currency in 87% of the trades, followed by the euro with a share of 33% of the turnover. The share of the euro in the foreign exchange market has however declined by nearly six percentage points since spring 2010. In contrast, the currencies that recorded the most significant increase in market share were the Japanese yen, and in the emerging markets the Mexican peso and the Chinese yuan.
The bulk of Finnish banks' inter-dealer transactions was with foreign dealers. In contrast, the majority of Finnish banks' transactions with non-financial customers were local transactions. In recent years, the largest increase has been in foreign exchange transactions with for example, small banks, institutional investors, hedge funds and public sector financial institutions as counterparty. In Finland, turnover with these financial institutions was more than five-fold, and accounted for 19% of total turnover. Globally, the share of other financial institutions increased to 53%.
Global foreign exchange turnover continues to be increasingly concentrated in the United Kingdom and United States; their share of the turnover was up, to nearly 60%. The share of the largest foreign exchange trading centre, the United Kingdom, has grown continuously since the 2001 survey, to 41% in this year's survey.
Average daily turnover in Finnish OTC interest rate derivatives in April 2013 was approximately 70% higher compared to April 2010, and totalled USD 2.2 billion. The most significant increase was in interest rate swaps, where turnover increased from just under USD 1 billion to nearly USD 2 billion. Total global trading in interest rate derivatives was up by 14%, to ca USD 2,350 billion. In global terms, this was the smallest increase since the start of the BIS survey on interest rate derivatives in 1995.
Euro-denominated interest rate derivatives accounted for a significant majority, ie 92%, of total turnover in Finland. With a share of 49%, they were the most traded interest rate derivatives also on the global level: their share increased a full 8.5 percentage points compared to 2010. Globally, the euro-denominated interest rate derivatives were followed by those denominated in US dollars, with a share of 28%.