The Bank for International Settlements (BIS) reported today that foreign exchange trading volume reached a record high in April, with an average of $9.5 trillion per day (approximately €8.2 trillion), surpassing the previous peak in March 2020 during the height of the COVID-19 pandemic.
Over $1.5 trillion of this trading volume was driven by a sudden increase in transactions following the announcement of additional tariffs by Donald Trump on April 2, which took markets by surprise with their magnitude, coupled with an unexpected devaluation of the dollar.
The BIS, headquartered in Basel, Switzerland, stated in its report, “The foreign exchange market appeared to act as a buffer during the turbulence of April 2025.”
During that month, banks and institutional investors, such as insurers and funds, had low hedging rates for currency risk, leaving them inadequately protected against losses.
The low level of investor hedging amplified the surge in trading following the announcement of increased tariffs on imports into the United States.
Many investors adjusted to the increased risk of their dollar investments through currency derivatives instead of selling the underlying assets.
Despite these movements, the BIS believes there were no signs of dollar financing pressure in April.
