Thursday, the Reserve Bank of Australia said that the global foreign exchange turnover rebounded between April and October 2009 across all markets and major currency pairs.

In its March quarter bulletin published today, the central bank noted that the currency trading rose 17% to $2.7 trillion a day between April and October 2009, citing data from five major foreign exchange markets of Australia, U.S., U.K., Canada and Singapore.

These data are compiled by foreign exchange committees in each of the 5 major markets by surveying financial institutions active in foreign exchange markets. These five markets account for just over 60 per cent of global foreign exchange activity and hence provide a good indication of global trends.

The broad-based increase in turnover is in line with the improvement in global economic and financial conditions since early 2009. Despite the rebound, turnover remains below the peak in early 2008, RBA noted.

Furthermore, RBA said that the pick-up in overall turnover was broad-based across all instruments over the six-month period. The rebound in spot and forwards turnover was particularly sharp and the major factor that drove the rebound in turnover in these instruments was the recovery in international trade from its crisis-related through in early 2009.

Turnover in foreign exchange swaps, cross-currency swaps and options also increased over the period, but, as for spot and forwards, turnover still remains below its peak in 2008. Turnover in options increased particularly strongly (42 per cent), following sharp falls since April 2007.

Over the six months to October 2009, developments in the Australian market broadly followed those in the four other markets, suggesting that the same global factors were important in driving recent developments in Australia, the central bank said. The aggregate turnover in the Australian market increased strongly like other markets, but remained well below its early 2007 peak.