SGX’s RMB Futures Contracts Soar in Debut As Chinese Currency Demand Heightens

The Singapore Exchange’s (SGX) offering of recently launched Chinese Renminbi (RMB) futures, including both the USD/CNH and CNY/USD, has been met with insatiable demand, helping contribute to swelling volumes in its debut.

The SGX initially introduced a variety of FX futures last month, including the USD/CNH, CNY/USD, USD/JPY and THB/USD. In addition, the Bank of China (BOC) also became the inaugural market maker for RMB futures on SGX’s platform nearly one month ago.

Overall it was a robust debut for the SGX’s RMB initiative, with futures swelling to 1,836 contracts or worth $180 million (RMB 1.1 billion) in notional value. The constituency of the Market Makers Market Makers Market makers or called dealing desk brokers represent a type of broker that internalize flows and are taking the opposite side of a transaction submitted by their clients. The market making broker is only quoting a feed of prices to its clients. These feeds may or may not be the exact same as the prices quoted on the interbank market.Any order a client enters is processed internally and never goes out to the market, except in rare cases where a market making brokerage identifies a client as a v Market makers or called dealing desk brokers represent a type of broker that internalize flows and are taking the opposite side of a transaction submitted by their clients. The market making broker is only quoting a feed of prices to its clients. These feeds may or may not be the exact same as the prices quoted on the interbank market.Any order a client enters is processed internally and never goes out to the market, except in rare cases where a market making brokerage identifies a client as a v Read this Term and other notable participants for the RMB futures contracts included the BOC, DBS Bank, ICBC Singapore branch (ICBC), Quantrun Investment Management, and Virtu Financial.

The initial offering and exposure to the RMB on the SGX represented a move by the group to help keep up with rising demand. It will be interesting to see how this offering manifests itself not only on the SGX but other exchanges in the region as well, especially if volumes and demand continue to keep pace.

The RMB love has not been reserved for exchanges only however – earlier this month the UK Treasury appointed Bank of China (Boc), HSBC, and Standard Chartered to help issue RMB denominated bonds, the first such offering outside China.

According to Guo Ning Ning, General Manager, BOC Singapore Branch in a recent statement on the RMB performance, “As Singapore’s largest RMB business service provider, Bank of China is pleased to partner SGX as the pioneer market-maker for the newly launched RMB futures and to have executed the first trade. We will continue to Leverage Leverage In financial trading, leverage is a loan supplied by a broker, which facilitates a trader in being able to control a relatively large amount of money with a significantly lesser initial investment. Leverage therefore allows traders to make a much greater return on investment compared to trading without any leverage. Traders seek to make a profit from movements in financial markets, such as stocks and currencies.Trading without any leverage would greatly diminish the potential rewards, so traders In financial trading, leverage is a loan supplied by a broker, which facilitates a trader in being able to control a relatively large amount of money with a significantly lesser initial investment. Leverage therefore allows traders to make a much greater return on investment compared to trading without any leverage. Traders seek to make a profit from movements in financial markets, such as stocks and currencies.Trading without any leverage would greatly diminish the potential rewards, so traders Read this Term our expertise in RMB businesses to enable global investors to more easily invest in RMB futures.”