The global foreign exchange market is currently experiencing a healthy growth. Foreign exchange (FX), or forex, refers to a system that facilitates the transaction of currencies from different countries. It is performed through credit instruments, such as bills of foreign currency, bank drafts and telephonic transfers. The fund transfer functions through an electronic network of banks, financial institutions, brokers and individual traders. Forex also finds extensive applications for transferring funds to support the exchange of various goods and services between nations.
Growing urbanization and digitalization in both the emerging and developed economies are among the key factors driving the growth of the market. The key features of FX, such as minimal trading costs, 24x7 trading opportunities, high transactional transparency and liquidity, have favored its widespread acceptance across the globe. Furthermore, the availability of electronic platforms and the provision of improved security mechanisms for trading are also providing a boost to the market growth. Various internet-based platforms are available to the users for conveniently exchanging currencies between countries while ensuring the delivery of goods and services in a secure and centralized setting. Additionally, various technological advancements, such as the availability of outright forward and currency option, are creating a positive outlook for the market growth. Outright forward enables the trader to lock the current exchange rate, which further protects the investor, exporter or importer from future rate fluctuations. On the other hand, the currency option refers to a contractual document that establishes an obligation to purchase or trade currency at a specific rate. Looking forward, IMARC Group expects the global foreign exchange market to register moderate growth during the next five years.
IMARC Group provides an analysis of the key trends in each sub-segment of the global foreign exchange market report, along with forecasts for growth at the global, regional and country level from 2021-2026. Our report has categorized the market based on region, counterparty and instruments
Breakup by Counterparty:
Breakup by Instruments:
Breakup by Region:
The report has also analysed the competitive landscape of the market with some of the key players being Barclays, BNP Paribas, Citibank, Deutsche Bank, Goldman Sachs, HSBC Holdings plc, JPMorgan Chase & Co., The Royal Bank of Scotland, UBS AG, Standard Chartered PLC, State Street Corporation, XTX Markets Limited, etc.
The global foreign exchange market was worth US$ XX Trillion in 2020.
According to the estimates by IMARC Group, the global foreign exchange market will exhibit moderate growth during the next five years.
The foreign exchange market provides 24x7 trading opportunities, enormous trading volume, and high transactional transparency, that are currently driving the global foreign exchange market.
Numerous technological advancements have led to the wide availability of outright forward and currency options, thereby representing one of the key trends in the global foreign exchange market.
Sudden outbreak of the COVID-19 pandemic had led to the implementation of stringent lockdown regulations across several nations. This has negatively impacted the foreign exchange market due to the declining performance of the registered industries and restricted amount invested in the exchange.
On the basis of the counterparty, the market has been classified into reporting dealers, other financial institutions, and non-financial customers. Amongst these, reporting dealers hold the largest market share.
On the basis of the instrument, the market has been categorized into currency swap, outright forward and FX swaps, and FX options. At present, currency swaps exhibit a clear dominance in the market.
Region-wise, the market has been classified into North America, Europe, Asia Pacific, Middle East and Africa, and Latin America, where North America dominates the global market.
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