These challenges were exacerbated by the market volatility, but even as market conditions stabilised, many of the operational challenges remained. However, the FX industry generally has been able to meet these challenges. A recent report issued by the GFXC summarised the experiences of both buy-side and sell-side market participants throughout this time.3 Broadly speaking, electronic trading proved effective and reliable.
It is likely that the Covid period will have only furthered the industry’s shift toward electronic trading. This includes the greater use of execution algorithms in many markets. From the GFXC’s perspective, the recent period has highlighted the importance of having common standards of industry practice. The abrupt change in market conditions that we witnessed this year also underscored the importance of transparency.