Forex Blog: Currency Trading News & Analysis.

January 23rd 2006

OTC Yuan trading system takes shape

Last year, over $300 Billion in currencies were traded via China’s foreign exchange market. 98% of this trade, however, involved China’s official interbank market, in which buyers and sellers are matched up in a centralized system. This will soon change, however, as China prepares to open the new market, in which currency trading will be facilitated by 13 banks, including five that are foreign. The Central Bank will continue to set the so-called parity price and control the Yuan exchange rate via calculated intervention. However, as part of the new system, private market-makers will have more discretion in setting prices, which could spur further Yuan appreciation. AFX News limited reports:

One analyst noted that current prices are not necessarily indicative of future trends on the two markets. “The key thing is now is they’ve got a market. People are going to push the envelope a little bit and…test the limits a little bit more,” he said.

Read More: China mulls upper tier of market makers in new OTC market

SocialTwist Tell-a-Friend
Posted by Adam Kritzer | in Chinese Yuan (RMB), Investing & Trading | 1 Comment »

Sponsored Offers

FREE Daily Email Updates

Enter your email address:

Delivered by FeedBurner

One Review of “OTC Yuan trading system takes shape”

  1. HouseTaker Says:

    yuan is still too risky to trade; i think the major implication of this will be the boost it gives to the private banking sector in china, which probably will affect international commerce and hence will impact both FDI and china’s currency reserves. if these end up being significant, they’ll end up in the charts.

Have Questions? Want to Share Your Review?

Be heard. Please share your reviews today!

Neighboring Posts

© 2004 - 2024 Forex Currency charts © their sources. While we aim to analyze and try to forceast the forex markets, none of what we publish should be taken as personalized investment advice. Forex exchange rates depend on many factors like monetary policy, currency inflation, and geo-political risks that may not be forseen. Forex trading & investing involves a significant risk of loss.