What’s behind the mystery of the missing liquidity

The FX liquidity landscape is changing. In G10 markets especially, there is a definite decade-long trend towards lower so-called primary market volumes as a fraction of total lit liquidity, to the extent that it calls the name ‘primary’ into question for a number of key currency pairs. Additionally, as these are lit venues, the signalling risk of posting on primary remains largely unchanged, as the probability of a fill goes down. This may lead to a feedback loop of decreasing The FX liquidity landscape is changing. In G10 markets especially, there is a definite decade-long trend towards lower so-called primary market volumes as a fraction of total lit liquidity, to the extent that it calls the name ‘primary’ into question for a number of key currency pairs. Additionally, as these are lit venues, the signalling risk of posting on primary remains largely unchanged, as the probability of a fill goes down. This may lead to a feedback loop of decreasing

The FX liquidity landscape is changing. In G10 markets especially, there is a definite decade-long trend towards lower so-called primary market volumes as a fraction of total lit liquidity, to the extent that it calls the name ‘primary’ into question for a number of key currency pairs. Additionally, as these are lit venues, the signalling risk of posting on primary remains largely unchanged, as the probability of a fill goes down. This may lead to a feedback loop of decreasing