This article sets out the results of the first comprehensive statistical survey of the volume and composition of foreign exchange business transacted by banks and brokers operating in London. The survey, which was conducted by the Bank of England in March of this year, showed that:
- banks' average total turnover was equivalent to US$115 billion per day: adjusted for the double reporting of transactions between banks in the United Kingdom, the average volume totalled US$90 billion per day;
- the major share of trading was between the US dollar and sterling (30 per cent), closely followed by US dollar/deutschemark business (28 per cent);
- virtually all business was in spot contracts (73 per cent) or in forward contracts of no more than one year's maturity (26 per cent): foreign currency options and futures contracts formed a relatively insignificant part of the market;
- the market was largely interbank (89 per cent), with a major share of banks' reported business (43 per cent) conducted through brokers.