Middle East foreign exchange traders increase trade in Euro\US dollar by 70%

The Euro/US Dollar currency pair accounted for 58% of all currency volume traded through dbFX in the Middle East during the third quarter of 2008.

This represents a 70% increase in trading volumes for the Euro/US Dollar currency pair when compared to trading volumes in the second quarter of 2008

The Euro/US Dollar was the most traded currency pair across all regions for dbFX during the third quarter of 2008.

With the global financial crisis unfolding in the US and European markets during the third quarter, the Euro/US Dollar saw exceptionally large volumes as traders looked to take advantage of the volatility in these markets.

Middle Eastern FX traders' second most popular currency pair during the third quarter of 2008 was the Sterling/US Dollar, accounting for 15.5% of all regional volumes.

The Sterling/Japanese Yen currency pair was third placed during the third quarter for the Middle East, with just over 9.5% of all volumes.

Betsy Waters, Global Director of dbFX for Deutsche Bank, said:

"The latest volume figures indicate that our Middle Eastern clients are attracted to currency pairs which offer tight spreads, as these offer the best trading strategy prospects. During the third quarter of the year, the Euro/US Dollar currency pair offered the tightest spreads, which has resulted in the 70% increase in trading in the pair in the Middle East. FX traders from the Middle East also appear to be comfortable trading the Euro as many have business dealings and investments in Europe. We are seeing more and more investors in the Middle East entering the FX markets as the growth prospects of global equity and bond markets diminish. FX offers investors the means to diversify their portfolios, as FX is proven to have low correlation to bond and equity market returns."

The daily turnover of the world's currency markets is around $3.2 trillion a day, compared to $500bn for the US government bond market and $156bn for NYSE Euronext.

This means investors are able to trade in an asset class with a large liquid market.

FX markets are open 24 hours a day, 7 days a week, giving investors consistent access to the market.

FX is also an easy and cost-effective way of investing with access to the market through online platforms such as dbFX.

Waters added: "Deutsche Bank's number one position in FX* is hugely beneficial to our Middle Eastern retail FX customers. By trading through dbFX, our customers are dealing with the largest liquidity provider, Deutsche Bank, giving them access to competitive spreads. Our retail customers are able to make informed FX strategies, as they have direct access to Deutsche Bank's award winning FX research*. They also have the safety and security of knowing that they are clients of one of the world's leading banks."

"The growth in FX volumes and customers in the Middle East over the past year confirms that the region is one of our fastest growing FX markets. More and more investors from the region are discovering the opportunities available with FX as an investment asset through dbfx.com and dbfxarabic.com," concluded Waters.

Launched in 2006, dbFX.com is available in multiple languages, is accessible in over 70 countries around the world and has 34 currency pairs available to investors on its platform.

Deutsche Bank was ranked the No. 1 Foreign Exchange Bank in 2008 by Euromoney magazine for the fourth year running.