Feb 01, 2024
Eurex
Fixed Income market briefing February 2024
January 2024 was the strongest January for Fixed Income and Currencies at Eurex
Volumes saw double-digit gains, recording a 31% increase. Futures outperformed relative to options, with the core franchise producing solid gains. The nascent STIR segment continued to trade solidly with over 2mn contracts trading over the month. We have always said that this is a long-term initiative, and we continue to refine elements of our approach to give ourselves the best possible chance of success. Additionally, in January, we made further enhancements and optimization to our initial margin for STIRS, which will support our buildout. FX began the year on solid footing, with volumes up c.40% and client onboarding increasing over the course of the month.
Despite lower volumes compared to January 2023, credit showed real progress, with five new clients testing the pipes and trading over the month. The team focused on finalizing the launch of the USD Emerging Market Sovereign and Sterling credit index futures. These will be closely followed by the USD indices in Q2. These launches ensure that we build a truly multi-currency portfolio, providing our global clients access to increasing liquidity pools. The team and I are genuinely excited by the development of this segment, and we will continue to be the drivers of innovation in this space.
As we enter February, volumes remain elevated, which we expect to continue through the quarter's end. Geopolitical and event risks continue to keep markets on their toes, and Europe looks attractive compared to other G10 markets. The risk remains that volatility is cheap relative to macroeconomic and event risk factors. Inflation is expected to continue declining to a level where Central Banks feel more comfortable. Yet, the challenge will be keeping it around their target levels, which should help to underpin our portfolio.
The team is focused on building out newly launched markets and working on delivering our roadmap items. We’re confident that building out our full-service offering better serves our members, liquidity providers, and end clients. The new initiatives in the pipeline for Q2 will only strengthen this.
Once again, we’re humbled by the support of our members, liquidity providers, partners and end clients. We’re committed to developing products and services that meet your needs in the present and future.
