In the first half of 2025, the combination of U.S. tariff announcements and fiscal and monetary policy uncertainty led to volatility in FX markets not seen since early 2020. During this period, our FX central limit order books (CLOBs) proved vital to traders for managing their risk, providing the essential market transparency, deep liquidity and execution reliability, which is critical in difficult market conditions. As a result, we saw a significant increase in volumes with several all-time volume records in currency pairs across our spot, NDFs and futures and options marketplaces.
Some industry commentary speculated that during this period there was a “liquidity mirage” in currency markets. However, if we look at observable data from our market leading FX venues, this claim is not supported. While headline top-of-book spreads are expected to widen with increased market volatility, and extreme market stress events impact short-term liquidity, it’s essential to look beyond surface-level indicators. Examining a wider spectrum of datapoints, such as top-of-book spreads, price continuity, liquidity replenishment and the amount of volume transacted at various price points, helps us understand how lit, anonymous and firm liquidity venues supported traders when they needed it most. The important role that our venues play also illustrates how they're fundamentally different from other platforms, including anonymous streaming venues that feature last-look liquidity.
A spotlight on the spot and NDF primary markets
Focusing on EBS Market, which provides centralized all-to-all matching for spot FX and rolling one-month non-deliverable forwards, our markets provided much-needed clarity in fast-moving market conditions during H1.
- Elevated volumes: April 2025 was the highest volume month for EBS Market since March 2020, with more than $100B average daily volume (ADV) traded between April 3 and April 7 alone.
- Strong NDF volumes:
- May was a stand-out month for NDF trading, with over $17B traded on May 2, which was the highest volume day since February 2020.
- May 2 also saw over $6B of USD/TWD NDFs traded. On this day, the Taiwanese dollar soared 3.8% in a single session, equivalent to a 19-standard-deviation move. EBS Market traded ~74% of price points from 00:00 GMT to 20:00 GMT.
- February 11 saw over $7 billion of USD/INR NDFs traded.
- Strong NDF volumes:
- Magnitude of order flow: Between April 3 and 7, approximately 3.5M firm orders were placed on a daily basis for EUR/USD, USD/JPY and USD/CNH, with the maximum single order size being EUR 999M.
- Price continuity: Amid the height of volatility, the liquidity replenishment was strong, with percentage of price points traded in EUR/USD and USD/CNH being ~90%.
- Top-of-book spreads: Despite a 64% surge in EUR/USD volatility, average top-of-book spreads on EBS Market rose by a modest 0.15 pip to 0.89 pip from 0.74 pip in 2024.
How derivatives provide a beacon of light in complex markets
Turning to our centralized all-to-all matching markets for FX futures (IMM-dated or monthly), FX options and spot-to-futures basis risk via FX Link, our markets provided increased transparency and firm liquidity in volatile market conditions.
- Elevated volumes: April 2025 saw ADV of $101B (+31% YoY) for FX futures, $7.8B (+64% YoY) for FX options and $4.9B (+49% YoY) for FX Link.
- On April 4, FX Link had an all-time single-day volume record of $14.6B traded.
- On March 5, FX options saw $23B notional volume traded in a single day - the highest volume day since February 2016, primarily driven by activity in EUR/USD.
- Strong currency pair volumes:
- On May 23, BRL futures ADV reached a record $3B notional (178K contracts).
- On February 3, CAD futures reached a record volume of $24B (386K contracts), with average daily open interest up 100% YoY.
- Magnitude of order flow: On April 4, 2.5M orders were placed in the EUR futures, with a maximum single order size of EUR 94M.
- Price continuity: On April 4, as markets moved, liquidity replenishment was strong with 100% of all price points traded in EUR/USD futures (in a price range of 183 pips).
- Top-of-book spreads: Despite a 68% increase in EUR/USD volatility, average top-of-book spreads rose by a modest 0.17 pip to 0.74 pips.
- FX Link spot to IMM futures basis spread: Between April 3 and April 4, FX Link traded record volumes with EUR/USD seeing consistent intraday TOB spreads and distribution.
Contrast to relationship-based streaming in the spot market
While centralized all-to-all matching order books provide a vital source of liquidity in difficult market conditions, bilateral, disclosed trading also plays a critical role for customers in sourcing liquidity and optimizing their trading activity. Particularly for traders requiring an additional layer of flexibility or those executing sensitive trades or complex strategies. EBS Direct, our streaming spot liquidity platform, acts as a complement to primary market liquidity access and during the recent period of volatility, performed strongly.
- Elevated volumes: Between April 3 and April 7, over $32B traded on average per day.
- LP fill ratio: Between April 3 and April 7, EBS Direct maintained a high LP fill ratio of 91.5%, outperforming some other notable streaming platforms that disclosed fill ratios dropping from 72.7% and 84%.*
- Median LP response times: Remained at five milliseconds, with the platform supporting only FX Global Code compliant LPs.
- Realized effective spreads: EBS Direct delivered significantly tighter execution costs, with realized effective spreads increasing by just over 50% for EUR/USD and USD/CNH, compared to a tripling on other streaming venues.*
*As referenced in a recent FX Markets article.
Beyond the liquidity mirage: The true value of central limit order books
Our spot, NDFs, futures and options CLOBs play a vital role in the fragmented FX marketplace by bringing together genuine market interest and facilitating all-to-all liquidity interaction. Widely recognized as sources of price reference, they complement and support efficient bilateral pricing in the wider marketplace. The central tenets of these centralized marketplaces are ever more important in volatile market conditions and include: transparency, firm liquidity, market efficiency and a reliable source of price discovery. By providing firm liquidity and transparent market data, these venues enable better decision-making and efficient risk management, leaving no room for liquidity mirages. Our unique network of 1,400 institutions and over 100,000 active FX traders globally allows users to find and transact with genuine market interest, reinforcing the role of these marketplaces as foundational to the FX ecosystem.
Contact FXteam@cmegroup.com for more information or to discuss these topics further.
All data points/statistics provided by CME Group
All examples in this report are hypothetical interpretations of situations and are used for explanation purposes only. The views in this report reflect solely those of the author and not necessarily those of CME Group or its affiliated institutions. This report and the information herein should not be considered investment advice or the results of actual market experience.
