HKEx’s Rmb futures launch bodes well for offshore Rmb market
HKEx’s introduction of Rmb futures trading part of broader move towards central clearing of derivatives. August 27, 2012 | Magessan RajHong Kong Exchanges and Clearing Limited (HKEx) has announced that it will introduce renminbi futures trading from September 17th, 2012, in a move that will undoubtedly spur internationalisation of the renminbi. The world’s first listed deliverable renminbi futures, HKEx has said that the US dollar/renminbi contracts will be available in sizes of $100,000, to be quoted in American terms as renminbi per US dollar. The contracts will be settled and margined in renminbi, and will require delivery of US dollar by the seller and payment of the final settlement value in renminbi by the buyer at maturity. The contracts will be settled according to spot US dollar/renminbi fixing published by the Hong Kong Treasury Markets Association on the last trading day. Commenting on HKEx’s latest offering, chief executive Charles Li said, “These new futures are part of our strategy to offer a wide range of renminbi-related products and expand beyond equities and equity-related derivatives into fixed income, currencies and commodities. In addition, they will help us support renminbi internationalisation and Hong Kong's further development as an offshore renminbi centre." Although the margin requirement has not been finalised, HKEx has said that it is expected to be 1% of notional amount with at least 50% of the margin requirement covered by cash in renminbi. Having identified the key target markets in London, New York, Tokyo, Singapore and Hong Kong for the new contracts, HKEx has stated that the futures pose minimal counterparty risk, with the Hong Kong Futures Exchange Corporation positioned as the counterparty with liquidity ensured by two market makers – HKEx has yet to reveal both, although it has said that one would be a British bank and the other from Singapore. Although over-the-counter renminbi futures delivered in US dollars are nothing new to investors, this is the first time they will be able to trade listed contracts and receive renmi... Please login to read the complete article. If you already have an account, you can login now or subscribe/register.
Categories: China, Clearing & Settlement, Exchanges, Hong Kong, Markets & Exchanges, RmbChina,Clearing & Settlement,Exchanges,HK,Markets Exchanges,Rmb, China,Clearing & Settlement,Exchanges,Hong Kong,Markets & Exchanges,Rmb, Keywords:HKEx, Renminbi Futures, Charles Li, Hong Kong Futures Exchange Corporation, Calvin Tai, Conrad Kwok, Beijing HKEx, Renminbi Futures, Charles Li, Hong Kong Futures Exchange Corporation, Calvin Tai, Conrad Kwok, Beijing
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