The foreign-exchange market is the biggest in the world but it is getting smaller, according to the Bank for International Settlements.
Daily forex trading volumes have shrunk by $300bn in the past three years to $5.1trn, the first decline since the BIS began monitoring the market 16 years ago. Increasingly risk-averse banks have withdrawn from the market amid tighter regulation, notably in the wake of currency-rigging scandals. Hedge funds and speculators have traded less as banks have cut back on their market-making role.
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