Seoul: Transactions of over-the-counter (OTC) derivatives rose to the highest level last year, helped by a sharp increase in currency forwards and interest swaps, data showed Tuesday.
According to Yonhap News Agency, the combined turnover of OTC derivatives, including stock options and interest rate swaps, came to 26,461 trillion won (US$19.41 trillion) last year. This marks an increase of 1,758 trillion won, or 7.1 percent, from the previous year, as reported by the Financial Supervisory Service.
By product, currency-related products such as currency swaps and currency forwards amounted to 18,379 trillion won, making up 74.4 percent of the total transactions. Transactions of currency forwards saw a 6 percent year-on-year increase, reaching 18,165 trillion won, driven by rising demand for hedging against foreign exchange volatility amid a strong U.S. dollar.
In contrast, transactions of currency swaps experienced a decline of 7 percent year-on-year to 1,114 trillion won. On the other hand, interest rate swaps recorded a 9.4 percent rise, totaling 6,424 trillion won, according to the data.