State Bank unveils FX Matching platform for interbank trading

By: News Desk
Published: 09:13 PM, 24 Jan, 2024
State Bank unveils FX Matching platform for interbank trading
Stay tuned with 24 News HD Android App
Get it on Google Play

The State Bank of Pakistan (SBP) on Wednesday launched interbank trading platform to promote transparency in the market, reported 24NewsHD TV channel.


The State Bank said FX Matching platform, a state-of-the-art centralized foreign exchange platform, will bring clarity and transparency to foreign currency trading in the country.


The SBP said authorized currency traders will have due access to the system and the platform will cover weakness in the process of bidding and offers in the system.


Notably, the trading will be conducted anonymously, allowing participants to quote or respond to quotes without revealing their identities until a trade match occurs.


Furthermore, each participant can set credit limits for their counterparts in FX Matching, with the SBP advising them to establish limits with major market players for optimal quotes.


Starting January 29, 2024, banks are required to utilize the forex matching platform for executing interbank foreign exchange transactions that affect the foreign exchange exposure limit.


Additionally, in scenarios where the Federal Reserve Bank of New York is closed but the interbank FX market in Pakistan is open, trading on FX Matching will be conducted in Tom value.


This development comes in the wake of a recent International Monetary Fund (IMF) report, which urged the authorities to avoid formal or informal exchange rate restrictions.


The IMF emphasized that the SBP should limit its FX market interventions to building foreign exchange reserves and not hinder the rupee’s depreciation driven by market fundamentals. 


The authorities are also expected to intensify efforts to eliminate existing exchange restrictions and multiple currency practices in early 2024.


 


Reporter Ashraf Khan

Categories : Business