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CME Group Expands EM Currency Products

CME Group is adding to its portfolio of emerging markets currency products with the introduction of Turkish lira futures contracts. 

The contracts are scheduled to begin trading in the first quarter of 2009 on the Globex electronic platform. The contracts will be denominated in both US dollar (TRY/USD) and euro (TRY/EUR).

“This is very much a customer-driven initiative,” Derek Sammann, managing director, foreign exchange products at CME tells Squawkbox. “We asked the market which products they would like to see and the Turkish lira contract was one tool market participants said they would love to engage with.

“People who trade the Turkish lira are very FX savvy. This contract provides them with a cleared OTC product which is particularly relevant in helping overall trading liquidity during the current financial crisis,” he adds.

With a GDP approaching $950 billion and forecast to grow at 5.4% this year, Turkey’s economy offers long-term potential for trading in the lira.

“We see emerging markets currencies, such as the Turkish lira, as another component in growing our FX business around the world. As Turkey continues its development within the global economy, the lira contract will be a key plank in our growing emerging markets currency products range,” says Sammann.

In the last year, volumes in CME’s top four emerging markets currencies have grown by an average 152%. Volumes in the Russian rouble grew by 178%, Mexican peso by 56%, South African rand by 141% and Chinese renminbi by 234%.

The Russian rouble continues to set new milestones, CME says. In September the exchange had record monthly volumes in the Russian rouble, with an average daily notional value of $283.2 million.

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