The data is being streamed to Bloomberg terminals courtesy of the China Foreign Exchange Trade System (CFETS), which is the FX division of China’s central bank the People’s Bank of China.
FX traders, corporate treasurers and institutional investors can use the new Bloomberg live interbank CNY and CNH pricing to view executable quotes and trades on the interbank USDRMB spot, swap and forward markets.
BNP Paribas China deputy head of fixed income Julien Martin says his bank was one of the first to access the CFETS data through Bloomberg.
The new service will allow companies conducting business in CNY and CNH better control of pricing quotes and hedging of risk tied to China-related business, says Sam Phoen, head of global markets, China at ANZ.
“Onshore corporations and investors will benefit from real-time executable rates, while offshore players who are invested in China will have better visibility when hedging against movements of the RMB,“ he says.
Last week, ANZ said in a report that the offshore RMB (CNH) market needs a single pricing benchmark to further product development, as the lack of a unified interbank interest rate for the currency remains a hinderance to the development of new FX.
Despite these concerns, demand for Chinese currency-related products was strong this year as a growing trend of international central bank usage of the RMB as a key component of currency diversification efforts changed the market’s perception of the currency.
As a result, a larger market for offshore RMB is developing, and the new Bloomberg interbank pricing will help market participants take advantage of the trend, says Tod Van Name, Bloomberg‘s global head of FX, economics and commodities.
“Given the rapid internationalization of the RMB, this data is imperative to global markets as it provides our clients greater transparency for smarter and more timely trading, hedging and investment decisions,“ says Van Name.