Industry NewsFebruary 27, 2018

China launches CNY trading platform with a little help from NEX Markets

ChinaNEX Group, a leading financial technology company formerly known as ICAP, announced a partnership with China’s interbank market trading platform and infrastructure provider CFETS (China Foreign Exchange Trade System) to launch ‘CFETS FX2017’, a next-generation trading platform for the Chinese foreign exchange (FX) market.
China Foreign Exchange Trade System (CFETS) was founded in 1994 and is a sub-institution directly affiliated to the People’s Bank of China (PBC). Leveraging its established and robust infrastructure capabilities, unique seamless and integrated trading technology, NEX used the underlying technology behind NEX Markets’ EBS platforms to support the development of FX2017.
In 4 December 2017, CFETS launched the first phase of FX2017 with a central limit order book (CLOB) platform for spot onshore Chinese renminbi (CNY), which provides access to a central pool of liquidity and a public reference point for spot CNY pricing.
Michael Spencer, Group Chief Executive Officer of NEX
Michael Spencer, Group Chief Executive Officer of NEX

With phase two going live on 5 February 2018, CFTS launched a relationship-based platform for CNY trading of spot, forwards and swaps. This bilateral trading model allows Liquidity Consumers (LCs) to choose from a full range of bank and non-bank Liquidity Providers (LPs) to access tailored executable streaming prices.

Its first day of trading had an inter-bank FX market turnover of US $62.8 billion, with 480 institutions logged on to the new platform and 307 institutions conducting deals. Supporting the expansion and evolution of the domestic renminbi market, FX2017 offers a multi-execution, low-latency environment that will encourage a sustainable and healthy ecosystem for its participants.
“The launch of FX2017 is a major upgrade of our financial trading infrastructure”, said Madam Zhang Yi, President of CFETS, “It effectively ensures the safe, stable and efficient operation of the inter-bank foreign exchange market, enforcing the pricing power of the domestic Chinese market and opening it up to the global foreign exchange market.”
Seth Johnson, Chief Executive Officer of NEX Markets
Seth Johnson, Chief Executive Officer of NEX Markets

“NEX has a strong track record of innovation in financial markets technology and I am pleased that we have been able to work with our longstanding partners CFETS, to launch a public market for CNY spot FX and a next generation disclosed trading platform for CNY spot, forwards and swaps”, commented Michael Spencer, Group Chief Executive Officer of NEX, “This is a significant milestone in the development of the domestic FX market, and we will continue to support our CFETS partners as they roll-out further phases and we explore further partnership opportunities in the future.”

Seth Johnson, Chief Executive Officer of NEX Markets, added: “I’m extremely proud that NEX Markets has been able to leverage our trading technology expertise to jointly develop FX2017 with CFETS. As a result, the Chinese FX market now has access to multiple execution options in a robust and low latency environment. The launch of this new central limit order book platform in mainland China, will play a fundamental role in providing a public reference point for spot CNY pricing in the domestic FX market.”
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