Bank positions in FX swaps: insights from CLS

Pēteris Kloks, Patrick McGuire, Angelo Ranaldo and Vladyslav Sushko

BIS Quarterly Review, 2023

Abstract: A combination of CLS data with BIS statistics shows banks' FX swaps positions alongside the currency mismatches on their balance sheets. It sheds light on global dollar flows via FX swaps in key currency pairs and, specifically, on banks' use of these instruments to hedge exchange rate risk, engage in arbitrage or serve customers. Compared with Japanese and euro area banks, US banks have played an outsize role in FX swap markets by using maturity transformation to intermediate in the interbank market and between banks and non-banks.

JEL-codes: F31 F34 G15 G21 (search for similar items in EconPapers)
Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:bis:bisqtr:2309b

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