The daily trading volume of the Forex market is constantly changing and experiences fluctuations depending on economic factors, monetary policies, and global developments. According to the latest statistics released in 2024, the average daily trading volume of Forex is estimated to be between $6.6 trillion and $8.4 trillion.
This amount has increased compared to previous years, primarily due to the growth of algorithmic trading, the expansion of financial markets in Asia, and the rising participation of retail traders. This trading volume is several times larger than major stock markets like the New York Stock Exchange (NYSE), which has a daily volume of around $200 billion.
The high liquidity in Forex allows for quick buying and selling, making price fluctuations attractive for traders. This trading volume is mainly driven by central banks, financial institutions, multinational companies, and retail traders, and it is influenced by economic news, monetary policies, and interest rate changes.
Daily Trading Volume of the Forex Market
According to the Bank for International Settlements (BIS), the daily turnover of the Forex market has exceeded $7.5 trillion, marking a significant increase compared to previous years. This growth has been driven by the expansion of automated trading, advancements in trading platforms, and the influx of retail investors into the market.
One of the key aspects of this trading volume is its distribution among different currencies. Approximately 88% of all transactions involve the U.S. dollar, making it the dominant currency in the Forex market, followed by the euro and the Japanese yen. Additionally, a large portion of this turnover is handled by major financial hubs such as London, New York, and Tokyo.
The high liquidity of Forex ensures that a massive number of orders are executed smoothly at any given moment, creating multiple trading opportunities. Unlike stock markets, which may experience a sharp liquidity drop during financial crises, Forex maintains a stable trading volume and high liquidity at all times.
Trading Volume in Major Financial Centers in 2024
- United States: The daily trading volume in April 2024 reached $1.165 trillion, reflecting a 14.1% growth compared to the previous year.
- Singapore: The daily trading volume in this financial center reached $1.085 trillion, making it one of the most important trading hubs in the world.
- United Kingdom & Japan: These countries continue to be among the largest Forex markets, with high trading volumes and significant global influence.
Factors Influencing Forex Market Turnover
The daily trading volume in Forex is influenced by a combination of economic, financial, and technological factors. Some of the most important factors include:
1. The Role of Central Banks and Financial Institutions
Central banks, such as the Federal Reserve (Fed) and the European Central Bank (ECB), have a direct impact on Forex liquidity and trading volume through monetary policies, interest rates, and currency interventions. Additionally, commercial and investment banks play a major role in the market by executing large-scale transactions for their clients, contributing significantly to the total Forex turnover.
2. Activities of Multinational Companies and International Trade
International companies engaged in trade of goods and services need to exchange currencies to settle their transactions. These foreign exchange activities, including salary payments, supply chain financing, and investments in foreign markets, contribute to the increase in daily Forex trading volume.
3. Speculative Trading and Short-Term Investments
A significant portion of Forex trading volume comes from speculative activities. Retail traders, hedge funds, and financial institutions execute a high volume of buy and sell orders with the aim of profiting from price fluctuations. These speculative trades drive liquidity and enhance market activity.
4. Impact of Economic News and Global Events
Economic and political events can have an immediate and significant impact on exchange rates and trading volume. Interest rate changes, economic data releases (such as unemployment rates and inflation), geopolitical tensions, and financial crises lead to increased market volatility, encouraging traders to enter or exit positions quickly.
5. Technological Advancements and Easy Market Access
The development of financial technology (FinTech) and the emergence of online trading platforms have made it easier for retail traders to participate in the Forex market. Automated trading bots, smart algorithms, and technical analysis software have also contributed to the acceleration of trading execution and increased market liquidity.
Why is High Forex Market Turnover Important?
The high trading volume in the Forex market offers several key advantages, making it one of the most attractive financial markets. One of the most critical aspects of this market is its high liquidity. Given the massive number of buy and sell orders, traders can execute their transactions at any moment without worrying about the lack of buyers or sellers.
Additionally, high turnover ensures sufficient price fluctuations, creating ample trading opportunities for investors. These fluctuations are particularly beneficial for short-term traders and scalpers, enabling them to profit from constant exchange rate movements.
Another key benefit of the large trading volume is that no single entity has complete control over the market. Unlike some financial markets that can be influenced by central banks or large corporations, Forex remains decentralized and transparent, ensuring fair competition among traders.
In summary, high Forex turnover leads to increased liquidity, fast execution of trades, and diverse trading opportunities, making it one of the most popular and dynamic financial markets worldwide.
What is Liquidity in Financial Markets?
Liquidity is one of the most important characteristics of a financial market, referring to the speed and ease of buying or selling an asset without causing a significant change in its price. In a highly liquid market, traders can execute their orders at any moment with minimal delay, whereas in low-liquidity markets, transactions may be accompanied by high price volatility and wide spreads.
Most Traded Currencies in the Forex Market
The Forex market is the largest financial market in the world in terms of trading volume, with billions of dollars exchanged daily between different currencies. Among these, some currency pairs hold a greater share of market turnover due to high liquidity, broad participation of financial institutions, and large-scale international transactions.
1. Euro/US Dollar (EUR/USD)
This currency pair is the most traded pair in the Forex market, accounting for over 23% of the total daily trading volume. The popularity of EUR/USD is due to its high liquidity, low spreads, and sensitivity to economic data from the European Union and the United States. Central banks, financial institutions, and retail traders prefer this pair for its relative stability and moderate price fluctuations.
2. US Dollar/Japanese Yen (USD/JPY)
The USD/JPY pair constitutes approximately 13.5% of the total daily Forex transactions. The Japanese yen, as one of the world’s major reserve currencies, attracts investors during times of economic uncertainty. High liquidity and the impact of the Bank of Japan’s (BoJ) monetary policies make this pair a popular choice among traders.
3. British Pound/US Dollar (GBP/USD)
Known as the “Cable”, this currency pair accounts for about 9.5% of daily Forex trading volume. GBP/USD experiences more volatility compared to EUR/USD, making it an attractive option for traders looking for sharp price movements. Economic and political factors in the United Kingdom, including monetary policies of the Bank of England (BoE) and economic developments in Europe, heavily influence this pair.
4. US Dollar/Chinese Yuan (USD/CNY)
Given China’s significance in the global economy, the USD/CNY pair holds a substantial share of Forex trading volume. The People’s Bank of China (PBOC)’s monetary policies and trade relations between China and the United States play a major role in determining the price trends of this currency pair.
5. Australian Dollar/US Dollar (AUD/USD)
This currency pair is heavily influenced by the prices of Australia’s export commodities, such as gold and iron ore, and makes up about 5.4% of the total Forex trading volume. Due to Australia’s strong economic ties with China and its dependency on the commodity markets, AUD/USD exhibits interesting volatility patterns for traders.
Comparison of Forex and Crypto Market Volume
The Forex market and the cryptocurrency (crypto) market are two popular financial markets that have attracted investors due to their high liquidity and diverse trading opportunities. However, there are significant differences in daily trading volume and total market value between these two markets, which we will examine below.
Forex Market Volume
According to the Bank for International Settlements (BIS), the daily trading volume of the Forex market exceeds $7.5 trillion. This market, due to its key role in international trade, institutional investor participation, and 24-hour accessibility, is considered the largest and most liquid financial market in the world. The high trading volume in Forex is primarily driven by central banks, large financial institutions, multinational corporations, and retail traders.
Cryptocurrency Market Volume
The crypto market is significantly smaller than Forex, but it has experienced rapid growth in recent years. The daily trading volume in the crypto market fluctuates and ranges between $50 billion and $200 billion, depending on market conditions. The total market value of cryptocurrencies is estimated to be between $1 trillion and $2 trillion, which is significantly lower than the value of the Forex market.
One of the key differences between these two markets is the level of liquidity and stability of trading volume. While Forex benefits from high liquidity and its trading volume is influenced by economic news and monetary policies, the crypto market is highly volatile and its volume is driven by market sentiment, blockchain industry news, and public adoption trends.
Comparison Table: Forex vs. Crypto
| Feature | Forex | Crypto |
| Daily Trading Volume | Over $7.5 trillion | Between $50 billion and $200 billion |
| Total Market Value | Decentralized market linked to national currencies | Between $1 trillion and $2 trillion |
| Liquidity | Very high | Medium to high (depending on the cryptocurrency) |
| Trading Volume Stability | Stable and influenced by macroeconomic factors | Highly volatile and dependent on market sentiment |
How Much is the Daily Turnover of Crypto?
This amount fluctuates depending on market conditions, price volatility, and trader activity. Unlike the Forex market, where trading volume is more stable, the crypto market is heavily influenced by factors such as Bitcoin adoption news, regulatory changes, investment trends, and overall market sentiment.
During bull markets, the crypto trading volume rises significantly. For example, in 2021, when Bitcoin reached its all-time high, the daily trading volume in the crypto market surpassed $300 billion. In contrast, during bear markets, this volume declines significantly and can sometimes drop below $50 billion.
Gold Trading Volume in Forex
Gold is one of the most important assets in the Forex market and is traded under the symbol XAU/USD. Due to its safe-haven nature, this precious metal has always attracted investors and accounts for a significant trading volume in financial markets.
Daily Trading Volume of Gold in Forex
The daily trading volume of gold in Forex is variable and is influenced by factors such as market fluctuations, investor demand, monetary policies of central banks, and global economic conditions. On average, the daily trading volume of gold in global markets ranges between $100 billion and $250 billion. This amount can increase during periods of extreme volatility or economic crises, as investors turn to safe-haven assets like gold.
Compared to other assets, gold is one of the most traded commodities in Forex. Many traders use this metal as a hedging tool against inflation, currency depreciation, and economic instability.
Factors Affecting Gold Trading Volume in Forex
- Monetary Policies and Interest Rates: When central banks lower interest rates, the demand for gold rises, leading to an increase in its trading volume.
- US Dollar Index (DXY): Since gold is priced against the US dollar, fluctuations in the value of the dollar directly impact gold trading volume.
- Inflation and Economic Crises: During periods of high inflation or severe market volatility, more investors shift towards gold, increasing its trading volume.
- Activities of Central Banks and Financial Institutions: Many central banks manage their gold reserves, and their buying and selling activities have a direct impact on gold liquidity and trading volume.
Why is gold popular in Forex?
Gold is one of the most popular assets in the Forex market, and there are several reasons behind this popularity:
High liquidity:
Gold, as a global commodity, has a very high daily trading volume. This high liquidity allows traders to enter or exit the market quickly without causing significant price changes. As a result, trading gold is very suitable for short-term strategies like scalping or day trading.
Moderate price volatility:
Compared to some currencies and assets, gold has a noticeable price volatility that creates good trading opportunities. This volatility is neither too high to cause excessive risk nor too low to limit profitability; therefore, many traders see gold as a balanced option.
Safe haven role:
One of the main reasons for gold’s popularity is its role as a safe haven asset during times of economic, political, or global crises. When financial markets become unstable or national currencies lose value, investors flock to gold to preserve their wealth. This behavior increases demand and, consequently, trading volume.
Portfolio diversification and risk management:
Gold typically has low correlation with major currencies and other assets. This feature helps traders and investors reduce the overall risk of their portfolio by adding gold, providing protection against market fluctuations.
Impact of macroeconomic and global factors:
Gold prices are influenced by various factors such as interest rates, inflation, central bank policies, and the strength of the US dollar. This allows traders to find diverse trading opportunities by analyzing these factors in the gold market.
24-hour trading availability:
Like Forex, the gold market is open 24 hours a day, five days a week, offering greater flexibility for traders worldwide.