Singapore No 1 for currencies in Asia

Singapore overtook Japan as Asia's biggest foreign-exchange centre for the first time as trading surged in the past three years, the city's central bank said, citing a survey by the Bank for International Settlements.

The city's average daily foreign-exchange volume increased 44 per cent to US$383 billion as of April from US$266 billion in the same month in 2010, the Monetary Authority of Singapore said in a statement on Thursday. The average interest-rate derivatives volume climbed 6 per cent to US$37 billion over the same period, the highest in the region after Japan, it said.

"Singapore has definitely established itself as a hub for foreign-exchange trading," Khoon Goh, a senior currency strategist at Australia & New Zealand Banking Group in Singapore, said before the release of the statement. "Part of this emergence is due to the increasing importance of Asian currencies, and Singapore's time zone is well-suited for that."

The increase in ranking puts Singapore behind only Britain and the US in the US$6.67 trillion global currencies trading market, according to the BIS. The city's foreign-exchange market expanded as the government offered incentives to boost its financial markets, which also led to a surge in the nation's fund management industry, where more than 500 asset managers oversee about US$1.1 trillion.

"Our growing strength in foreign exchange is a key complement to the development of capital market and asset management activities," Jacqueline Loh, deputy managing director at the Monetary Authority of Singapore, said in the statement.

Foreign-exchange trading worldwide surged to an average US$5.3 trillion a day in April 2013, boosted by greater yen volumes, BIS said. Trading increased 33 per cent since the same period in 2010, the bank said, citing a survey of currency traders it runs every three years.