The material on this site is for financial institutions, professional investors and their professional advisers. It is for information only. Please read our Terms & Conditions, Privacy Policy and Cookies before using this site. Please see our Subscription Terms and Conditions.


All material subject to strictly enforced copyright laws. © 2021 Euromoney, a part of the Euromoney Institutional Investor PLC.

E-FX takes another step forward

Foreign exchange technology is set to take another step forward when the Chicago Mercantile Exchange's electronic foreign exchange (eFX) markets go live on Reuters. The agreement marks the first major linkage of sell-side traders in the interbank FX market to CME eFX futures markets, where hedge funds and other buy-side participants play a major role.

The CME, the largest US futures exchange, and Reuters announced the plans in May 2004 and beta testing of the service began in December. Several bulge-bracket banks and financial institutions participated in the launch including ABN Amro, Bank of America, Barclays Capital, HSBC, Royal Bank of Scotland, Skandinaviska Enskilda Banken (SEB), Société Générale and Fimat.

Currency futures haven't been as successful as other products, such as interest rate futures. The interbank FX community has been reluctant to participate in currency futures because futures terminology is different to spot FX. ?The CME trades in contracts of fixed amounts for each currency, some of which are quoted in inverse terms when compared with spot FX,? says Michael McCorkle, treasury business manager at Reuters. ?The CME price also includes a price adjustment to account for the future date settlement of the trade.

You have reached premium content. Please log in to continue reading.

Read beyond the headlines with Euromoney

For over 50 years, our readers have looked to Euromoney to stay informed about the issues that matter in the international banking and financial markets. Find out more about our different levels of access below.

SUBSCRIBE ONLINE TODAY

Unlimited access to Euromoney.com and Asiamoney.com

Expert comment, long reads and in-depth analysis interviews with senior finance professionals

Access the results of our market-leading annual surveys across core financial services

Access the results of our annual awards, including the world-renowned Awards for Excellence

Your print copy of Euromoney magazine delivered monthly

£73.75 per month

Billed Annually

FREE 7 DAY TRIAL

Unlimited access to Euromoney.com and Asiamoney.com, including our top stories, long reads, expert analysis, and the results of our annual surveys and awards

Sign up to any of our newsletters, curated by our editors

LOGIN NOW

Already a user?

We use cookies to provide a personalized site experience.
By continuing to use & browse the site you agree to our Privacy Policy.
I agree