The Singapore Exchange (SGX) is introducing Asian foreign exchange (FX) futures for deliverable and non-deliverable Asian currencies.
It will launch futures contracts from Nov 11 for six currency pairs: Australian dollar-US dollar, Australian dollar-Japanese yen, US dollar-Singapore dollar, Indian rupee-US dollar, Korean won-US dollar and Korean won-Japanese yen.
The Asian FX futures is in line with global G20 regulatory reforms whereby all standardised over-the-counter (OTC) derivative contracts should be traded on exchanges or electronic trading platforms, and cleared through central counterparties.
Trading on a regulated exchange platform will promote greater transparency, and better serve investment and risk management needs in the Asian time zone, SGX said in a statement.
"The trading of Asian FX futures on SGX offers global investors a transparent, margin-efficient and well-regulated marketplace to seamlessly manage their Asian currency risks," said SGX chief executive Magnus Böcker.
"We will be adding more currency pairs to our Asian FX suite over the next 12 to 18 months. This comprehensive range of Asian FX futures will contribute towards the continued growth of Singapore's FX market, which is already the world's third biggest FX centre," he added.
"By bringing Asian foreign exchange trading onto the exchange, SGX helps customers in their currency risk management activities and to minimise counterparty risks," said Andrew Ng, group executive (treasury and markets) at DBS Bank.
We are delighted to be supporting the launch of Asian FX futures in Singapore as a market-maker for the USD/SGD currency pair," he said.