Foreign Exchange Committee: 2006 Annual Report

摘要

The structure of the market has undergone significant change in the past three to four years. In 2006, the pace of change accelerated, and the new market that had been anticipated for years fully arrived. The combination of sophisticated electronic trading technologies, prime brokerage, and a more diverse set of market participants has altered counterparty relationships, affected liquidity conditions, and fostered a dramatic increase in the number of transactions. Today, nonbank participants are providing the market with liquidity via electronic platforms barely possible just one or two years ago. Retail investor access to the market has increased, bringing business risks as well as opportunities to wholesale market participants. High-velocity algorithmic trading and constant streamed liquidity are now commonplace across many currency pairs twenty-four hours a day.