Singapore’s foreign-exchange market expanded this year, doubling in size over the past four years and widening its lead over Hong Kong, as activity rebounded after the Covid-19 pandemic and demand for hedging climbed amid heightened geopolitical tensions.
Average daily turnover reached a record US$1.273 trillion in April, according to a semi-annual survey published by the Singapore Foreign Exchange Market Committee on Tuesday. Volume jumped 12 per cent from October 2024, and doubled from April 2021, the survey showed.
Traditional foreign-exchange trades – including spot transactions, outright forwards and swaps – amounted to US$1.14 trillion per day, while daily turnover of over-the-counter currency derivatives stood at US$133 billion, the committee said. They increased by 8 per cent and 50 per cent, respectively, from October 2024.
The growth reflects a broader trend of investors and multinational firms turning to the Southeast Asian financial hub for liquidity and currency risk management as trade wars and military conflicts in some regions spooked global markets. Investors also stepped up asset diversification as the US dollar depreciated amid US President Donald Trump’s tariff war.
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US-China trade remains ‘critical’, despite fraying relations and trade wars
US-China trade remains ‘critical’, despite fraying relations and trade wars
“Singapore’s FX surge reflects its deepening role as a regional liquidity hub, with structural demand from asset managers and corporates amplifying post-pandemic flows,” said Charu Chanana, Singapore-based chief investment strategist at Saxo Bank. Rising hedging needs and interest-rate volatility could also have driven the uptick, she said after the report.
