Hong Kong’s HKEX Improves Trading Conditions for RMB Currency Futures

RMB Currency Futures achieved a steadfast level of growth last month.

RMB Currency Futures traded at Hong Kong Exchanges and Clearing Limited (HKEx) are scheduled for enhancements to upgrade their accessibility and functionality, as well as providing greater over-the-counter flexibility, according to a bourse announcement.

The HKEX today revealed three improvements to its Renminbi (RMB) Currency Futures, which includes USD/CNH, EUR/CNH, JPY/CNH, AUD/CNH and CNH/USD futures.

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RMB futures were introduced to meet increasing demand in the region for risk management and cross-currency hedging tools. The move was also aimed at expanding the Hong Kong bourse futures market as the country has signaled its ambition to become an offshore yuan trading canter.

The first batch of changes concerns trading hours of RMB Currency Futures with HKEX extending the day and after-hours trading by half an hour and an hour and a quarter respectively, effective July 10, 2017.

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Hong Kong’s bourse operator has also introduced a second tier to the market maker program for HKEx’s RMB Currency Futures, the world’s first deliverable RMB currency futures. Specifically, the program will comprise primary and secondary market makers. HKEX noted that it welcomes new applications to join its market making program.

Finally, HKEX has extended its fee waiver for cash-settled RMB Currency Futures (EUR/CNH, JPY/CNH, AUD/CNH and CNH/USD futures) to the end of this year.

Finance Magnates reported yesterday on HKEX’s trading metrics for May 2017 which showed a bump across its securities and derivatives business. According to the exchange’s circular, RMB Currency Futures achieved a steadfast level of growth, broadly higher than the extent of its overall trading figures. In particular, HKEx unveiled its average daily turnover of RMB Currency Futures for the first five months of 2017 at 3,061 contracts, an increase of 31 percent year-on-year from the last year record of 2,335 contracts in 2016.

Earlier in March, renminbi currency options through a USD/CNH contract was launched to complement HKEX’s RMB product suite. The new contract is a follow-up to forex products launched by the HKEX in recent months, including USD/CNH futures and other RMB currency futures.

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