Everyone knows that high-frequency traders are the evil geniuses of the foreign-exchange market, right?

They damage liquidity, swoop aggressively on tiny price errors, curdle milk with their oh-so-fancy computers and generally make the market harder for everyone to navigate.

That's what their detractors say.

But the Bank for International Settlements, no less, doesn't seem to agree.

A new study by the BIS, based on research from officials at some 14 central banks, says that high-frequency traders (or HFTs in market speak) smooth out currency movements, help spread liquidity around this fragmented market and help to make trading cheaper for everyone.