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Exchanges & Clearing

CBOE Launches SEF NDF Trading CBOE Global Markets (CBOE) has announced the launch of NDF trading on its Swap Execution Facility (Sef), CBOE SEF. CBOE Sef will offer a fully anonymous central limit order book with firm all-to-all trading available to all market participants, configurable firm and non-firm streaming quotes for tailored liquidity needs and curated liquidity pools to help meet participants’ execution criteria. The Sef will also offer pre-trade Net Open Position (NOP) credit checks and real-time risk management. CBOE claims that there will be a diverse network of participants resting passive liquidity and a wide distribution network for market makers on the platform.
LCH Shows Initial Traction in G10 NDF Clearing LCH says it has cleared a total of $745 million of G10 FX NDF currency pairs less than one month after the products went live on its ForexClear service.  The new NDF currency pairs reflect the five most actively traded G10 currencies: Australian dollar, euro, Japanese yen, pound sterling and Swiss franc, against the US dollar. LCH says that expanding ForexClear’s coverage to incorporate these pairs increases opportunities for capital optimisation by increasing the number of products eligible for clearing at LCH.
CME Announces Bitcoin Launch Date, CBoE Self-Certifies Two exchange groups, CME Group and CBoE, have self-certified new contracts for Bitcoin futures products ahead of a full trading launch. CME Group has self-certified the initial listing of its bitcoin futures contract to launch Monday, December 18, 2017, while CBoE says its own launch date will be announced "shortly". The announcements were noted in a release by the US Commodity Futures Trading Commission (CFTC), which says its staff have held "rigorous" discussions with CME over the course of six weeks, and CBoE over the course of four months.
R5FX, Shanghai Clearing House to Launch FX Trading Platform R5FX and the Shanghai Clearing House (SHCH) will launch a new electronic marketplace next month, in a move which will enable Chinese banks to directly trade offshore RMB with London for the first time.  The platform, called Connect, is due to go-live on 18 December – following confirmation from the People’s Bank of China. Eight Chinese banks will be participating from launch, with further banks and institutions to be added at a later date. The products available for trading in this first phase will be USD/HKD, GBP/USD and EUR/USD. Profit & Loss understands that CNH and the remaining G10 currency pairs may also be added towards the end of Q1 2018. 
LCH Processes Its First Cross-Currency Basis Swap LCH SwapAgent, a service for the non-cleared derivatives market, has processed its first cross-currency basis swap.  The first trade was conducted between Credit Suisse and Deutsche Bank and was a EUR/USD cross-currency basis swap. The trade was brokered by Icap and processed through MarkitSERV. This represents the first non-cleared trade to be transacted as LCH STM, SwapAgent’s settlement-to-market legal and operational framework. LCH STM facilitates full and final daily NPV settlement, rather than collateralisation by way of exchange of variation margin, and the netting of such settlement and contractual trade cashflows. 
Nasdaq Plans Bitcoin Futures Nasdaq is planning to launch bitcoin futures next year.  This news comes as the value of bitcoin has been skyrocketing, reaching $10,000 per bitcoin yesterday, but rising to over $11,000 today, before falling back to under $10,000. At the start of 2017, bitcoin was valued at around $1,000.  It also comes after announcements from other major exchanges – CBOE and CME Group – that they are planning to list bitcoin futures before the end of this year. Profit & Loss understands that one way in which Nasdaq plans to differentiate its bitcoin futures contract is by basing the product on an index that uses pricing sources from more than 50 exchanges worldwide.
Seven Market Participants Agree to Clear CME OTC NDFs CME group has announced that seven market participants have agreed that they intend to clear OTC FX non-deliverable forwards (NDFs) by the end of Q1 2018. “As more clients and liquidity providers are affected by uncleared margin rules, additional market participants clearing NDFs will provide greater access to the capital efficiencies of OTC FX clearing for clients around the world. Emerging market currencies provide a unique opportunity to cross-margin NDFs with non-deliverable IRS cleared at CME, offering potential initial margin savings of up to 51%,” says CME in a statement issued The seven market particpants involved are: BBVA, Citi, Itau Unibanco, NatWest Markets, Santander, Standard Chartered and XTX Markets.
Nex Offers Clearing Connectivity for NDFs Nex Optimisation is now providing central clearing connectivity for its FX risk mitigation service in non-deliverable forwards (NDFs). The clearing connectivity capability enables dealers to flag trades that are part of a risk mitigation cycle for automatic submission to a central counterparty clearing house (CCP). This means that clients of Nex’s Reset FX risk mitigation service can now have their trades be submitted directly for clearing rather than having to be re-submitted for secondary matching prior to communication to a CCP. 
CME to Launch Bitcoin Futures CME Group plans to launch bitcoin futures in the fourth quarter of 2017, pending all relevant regulatory review periods. The new contract will be cash-settled, based on the CME CF Bitcoin Reference Rate (BRR), which serves as a once-a-day reference rate of the US dollar price of bitcoin.  Bitcoin futures will be listed on and subject to the rules of CME. "Given increasing client interest in the evolving cryptocurrency markets, we have decided to introduce a bitcoin futures contract," says Terry Duffy, CME group chairman and CEO.  "As the world's largest regulated FX marketplace, CME Group is the natural home for this new vehicle that will provide investors with transparency, price discovery and risk transfer capabilities."
CME Launches Wednesday Weekly FX Options CME Group has launched Wednesday Weekly FX options (Wednesday options). Wednesday options will be available in premium quoted and volatility quoted European style options with a 2 p.m. CDT fix on five major currency pairs: AUD/USD; GBP/USD; CAD/USD; EUR/USD; JPY/USD.  These Wednesday options will be available for trading and clearing on October 30, 2017, pending regulatory approval. CME Group has launched Wednesday Weekly FX options (Wednesday options), which expire on Friday. Wednesday options will be available in premium quoted and volatility quoted European style options with a 2 p.m. CDT fix on five major currency pairs: AUD/USD; GBP/USD; CAD/USD; EUR/USD; JPY/USD.  These Wednesday options will be available for trading and clearing on October 30, 2017, pending regulatory approval. Weekly options are designed to enable market participants to more precisely manage their currency risk during the week. Existing FX weekly options average daily volume reached a new record of 31,990 contracts in September 2017, which is up 76.6% compared to the same time period last year.