×

UPDATE 2-London daily FX volume rose in April, N America turnover fell -surveys

-surveys@ (Adds North American volume, dateline, byline)

LONDON/NEW YORK July 26 (Reuters) - Daily foreign exchange trading volume out of London reached $2.44 trillion in April, up 10 percent from the same month last year, thanks to increased turnover in sterling and the euro against the dollar, a semiannual survey by the Bank of England showed on Wednesday.

In North America, however, daily currency volume fell in April from a year earlier, as market volatility remained persistently low, given an improving global economy and sufficient central bank stimulus, according to a semiannual survey by the New York Federal Reserve's Foreign Exchange Committee released on Wednesday as well.

Total daily volume was $889.5 billion in North America, down 0.4 percent from a year ago. Spot FX transactions fell 6 percent during the month to $375.4 billion, along with over-the-counter options, which slid nearly 13 percent to $37.1 billion in April, the survey showed.

The results of the BoE survey cement London's position as the world's biggest foreign exchange trading center despite concerns about impact of Britain's exit from the European Union on the financial industry.

The survey showed trading in the pound against the dollar since Britain's surprise decision in June 2016 pushed daily trading of the currency against the dollar to a record $296 billion, up 5 percent from the previous FX survey in October.

Daily turnover in the euro-dollar exchange rate, meanwhile, rose 14 percent to $696 billion per day, the highest since April 2015, according to the survey.

Of the various instruments, foreign exchange swaps saw the biggest increase in turnover in April from six months earlier, with a 14 percent rise in volume.

"This shows fears of a Brexit impact on currency trading turnover is not being reflected for now, but this may change," said a currency strategist at a U.S. bank in London.

For North America, forwards and FX swap transactions increased 5.3 percent and 6 percent, respectively.

Analysts have said low volatility has dampened U.S. FX trading, a trend that has been ongoing for some time and is expected to continue well into summer.

"The lack of market moving events over the summer period and with few risks to attach meaningful risk premium to, suggest implied vols could remain at subdued levels," said Jennifer Hau, currency strategist, at Credit Agricole in a research note.

The euro/dollar exchange remains the most heavily traded currency pair in North America, with $83.5 billion in daily volume, or 22 percent of all spot transactions. (Reporting by Saikat Chatterjee in London and Gertrude Chavez-Dreyfuss; Editing by Nigel Stephenson and Steve Orlofsky)