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The size of the global economy in 2025 is about $117 trillion, according to the IMF. The volume of trading in foreign exchange markets is now up to $9.5 trillion per day, according to the Bank of International Settlements (BIS). Clearly, the volume of foreign exchange trading is much, much larger than the size of international trade in goods and services; for example, exports of goods and services are about 30% of world GDP.

Every three years since 1986, BIS (working with central banks around the world) has sought to measure the the amount of trading. The 2025 survey surveyed more than 1,100 dealers in foreign exchange markets, mostly banks, in 52 jurisdictions. Some results and analysis from the 2025 survey appear in the December 2025 issue of the BIS Quarterly Review. Here, I’ll focus on the overview article by Wenqian Huang, Ingomar Krohn, and Vladyslav Sushko, “Global FX markets when hedging takes centre stage.”

This figure shows the growth of FX markets over time. Overall, up 27% from the April 2022 data in the previous survey. The colors show the different kinds of financial instruments involved: comparing 2025 to 20233, you can see that the spot market and swaps market are the largest components.
 

The FX market can be viewed as reflecting several main motives. One is to facilitate transactions, like trade or investment with other countries. But these factors are far too small to account for $9.5 trillion per day. Thus, the two bigger motivations are either traders trying to make money by trading back-and-forth in different currencies, or those with exposures in different currencies seeing to reduce risk by hedging those exposures. Huang, Krohn, and Sushko describe the recent drivers of the market in this way:

Since the 2022 Triennial Survey, growth in FX volumes was primarily driven by reporting dealers’ trading with financial customers. Both spot transactions and trading of forwards and options with these counterparties rose noticeably. These instruments can be used to adjust exposures to currency risk on existing positions or to speculate on future currency moves. The growth of FX swap turnover was mainly due to trading with institutional investors, reflecting their funding and hedging needs across currencies. Overall, however, FX swap trading has grown only modestly since 2022, reflecting a stagnation in interbank activity.

Several forces shaped FX volumes in April 2025. Announcements of major shifts in US trade policy early in the month and an unexpected depreciation of the US dollar, including a sudden flip in the dollar’s correlations with major asset classes, roiled markets. Market participants rushed to hedge existing dollar exposures against further dollar depreciation (Shin et al (2025); Shin (2025)). This boosted turnover of forwards and options. 

Despite the extraordinary size of the FX market, it seemed to work fluently, without any obvious signs of stress, even as trading volumes rose dramatically in April 2025.

The foreign exchange markets also shows the continuing role of the US dollar as the global reserve currency. Every foriegn exchange transaction involves buying one currency and selling another. Thus, it’s conventional to think of the total volume of currencies as equal to 200% (that is, adding 100% of the buyers and 100% of the sellers). Out of that 200%, the US dollar accounted for 89% of all foreign exchange transactions in 2025, followed by the euro at 29%, the Japanese yen at 17%, the UK pound at 10%, and the Chinese yuan at 9%. What often seems to happen, in fact, is that when two non-US currencies are being traded, currency A is first turned into US dollars, and then the US dollars are turned into currency B–so what looks like a single transaction is split into two transactions, with the US dollar involved in both. The share of the US dollar in foreign exchange markets has been roughly the same for the last 25 years, even as these markets have grown very quickly.

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