According to CLS Bank, the volume of forex transaction during the month of June reached $5.12 trillion. This broke a record set in March 2010. This record turnover was 20% higher than one year beforehand. The Greek crisis has a lot to do with it.
The near-default experience of Greece is likely the main reason for the record turnover. Another reason for this record was the press conference by Ben Bernanke, in which he announced the end of QE2 and no QE3. Given the recent jobs report in the US, perhaps QE3 could return to the table.
The summer months in the northern hemisphere are usually slower in terms of trade. The ongoing woes of Europe make the saying “sell in May and go away” irrelevant this year, as CLS shows.
While the Greek crisis is now on the back burner after the vote on austerity, the talks about a second bailout program are stuck. In addition, troubles mount in other countries: Portugal and Italy topped the list just now. Spain and Ireland could return to the limelight soon.
In any case, September will feature not only the return of some significant market participants from a summer vacation, but also the next tranche of aid for Greece. So even if the summer months will be slower, a big bang is likely as they end.
Further reading: Forex Volume Falling in 2011? – Apparently the opposite is the case.Get the 5 most predictable currency pairs