LSEG to Launch an NDF Matching Venue in Singapore

London Stock Exchange Group (LSEG) is raising its support for the forex non-deliverable forwards (NDFs) as it has announced the development of a fully-cleared NDF matching in Singapore.

The new matching services will be developed with support from the Monetary Authority of Singapore (MAS), which is determined to keep the city-state status of a forex hub. According to the Bank for International Settlements (BIS), Singapore is the largest FX center in Asia and the third largest globally.

“LSEG’s decision to launch cleared NDF Matching in Singapore underscores Singapore’s position as a price discovery hub,” said Lim Cheng Khai, MAS’ Executive Director of the Financial Markets Development Department.

“As a leading inter-dealer platform, LSEG’s venue is a key addition to our FX ecosystem and will play an important role in meeting Asian market players’ growing FX needs.”

Growing Demand for NDFs

Also, it came when the demand for forex Forex Foreign exchange or forex is the act of converting one nation’s currency into another nation’s currency (that possesses a different currency); for example, the converting of British Pounds into US Dollars, and vice versa. The exchange of currencies can be done over a physical counter, such as at a Bureau de Change, or over the internet via broker platforms, where currency speculation takes place, known as forex trading.The foreign exchange market, by its very nature, is the world’s largest tradi Foreign exchange or forex is the act of converting one nation’s currency into another nation’s currency (that possesses a different currency); for example, the converting of British Pounds into US Dollars, and vice versa. The exchange of currencies can be done over a physical counter, such as at a Bureau de Change, or over the internet via broker platforms, where currency speculation takes place, known as forex trading.The foreign exchange market, by its very nature, is the world’s largest tradi Read this Term NDFs are picking up steam among institutional investors. A BIS triennial FX survey found that the average daily volume of NDF transactions jumped from $134 billion in 2016 to $258 billion in 2019.

In addition, the LSEG highlighted that the latest move is the first phase of its plan to implement NDF and Spot Matching along with building streaming relationship venues in Asia. Further, it will ease access to the full book of liquidity Liquidity The term liquidity refers to the process, speed, and ease of which a given asset or security can be converted into cash. Notably, liquidity surmises a retention in market price, with the most liquid assets representing cash.The most liquid asset of all is cash itself.· In economics, liquidity is defined by how efficiently and quickly an asset can be converted into usable cash without materially affecting its market price. · Nothing is more liquid than cash, while other assets represent The term liquidity refers to the process, speed, and ease of which a given asset or security can be converted into cash. Notably, liquidity surmises a retention in market price, with the most liquid assets representing cash.The most liquid asset of all is cash itself.· In economics, liquidity is defined by how efficiently and quickly an asset can be converted into usable cash without materially affecting its market price. · Nothing is more liquid than cash, while other assets represent Read this Term in the venue for all participants.

“As a leading provider of FX and capital markets solutions, there has been strong demand for LSEG to enter the NDF CLOB market as participants look for greater choice in where they execute,” Neill Penney, LSEG’s Group Head of FX, said.

Moreover, it was the first FX venue to use entirely LSEG’s core technology.

Meanwhile, several other FX industry players have entered Singapore. Earlier this year, TP ICAP Group announced its plans to launch a Singapore-based electronic foreign exchange trading platform. Furthermore, Integral made its IntegralFX services available from Singapore’s SG1 data center.

James Pearson, LCH’s Head of ForexClear, said: “[NDF Matching in Singapore] exemplifies not only the focus on Asia for LCH, and across LSEG, but also the innovation possible within LSEG to create a trading platform wherein a broader array of market participants can decide on a pre-trade basis to clear their NDFs.”