USD/CNH futures shoots past US$119b
TRADING value for the Singapore Exchange (SGX) USD/CNH (US dollar and offshore Chinese yuan) futures surpassed US$119 billion on March 27, as investors looked to hedge the renminbi on the back of the economic fallout from the Covid-19 pandemic, according to data from SGX.
Amid the mounting uncertainty surrounding the virus outbreak and border lockdowns, demand for risk management on currencies has "increased tremendously", said K. C. Lam, SGX's head of FX and rates.
The Indian rupee has also been trading at a record low against the US dollar, leading to more financial market participants managing their risks on SGX's platform, said SGX. Open interest for SGX INR/USD futures reached a new daily high of 122,738 contracts with total notional value of US$3.27 billion on March 20.
"Our clients are hedging more than usual, specifically on USD/CNH and INR/USD. They are also building larger open interests to protect their positions, and during the recent bouts of market volatility, we saw traders acting swiftly to hedge exposures and positions, leading to significantly higher market activity," said Mr Lam.
GET BT IN YOUR INBOX DAILY
Start and end each day with the latest news stories and analyses delivered straight to your inbox.
KEYWORDS IN THIS ARTICLE
BT is now on Telegram!
For daily updates on weekdays and specially selected content for the weekend. Subscribe to t.me/BizTimes
Capital Markets & Currencies
South Korea readies new system to detect illegal short-selling
Asia: Markets mixed as global rally stalls, eyes on yen
Singapore shares retreat at Thursday’s open; STI down 1.1%
Stocks to watch: Keppel, FCT, Suntec Reit, OUE Reit, Clint, Digital Core Reit, OKP, Cordlife
Europe: Stoxx 600 falls on banks drag; tech contains losses on ASMI boost
US: Stocks end flat ahead of key inflation data