Forex renaissance

In the late 1990s, the major derivatives dealers’ interest in foreign exchange ebbed dramatically.

Overshadowed by the strong revenues to be had in the increasingly volatile fixed-income and equity markets, and sidelined by attention paid to the industry’s new darling – credit derivatives – many dealers assumed most vanilla forex business would migrate to electronic platforms and that exotics would be a business for only a few specialist firms.

Merrill Lynch reflected the industry’s ambivalence towards forex. Over the past decade, it has added and shed forex staff several times