The Chicago Mercantile Exchange and Reuters LLC are planning to open up currency futures trading to a wider customer base. And the partnership is more than just the CME displaying its market data on Reuters terminals, as some in the industry previously thought.
The two organizations have agreed to electronically connect their foreign exchange networks: the eFX futures contracts traded on CME’s Globex electronic trading system and Reuters’ Dealing 3000 system, which trades spot forex. The agreement is scheduled to go live for beta testing in December.
The partnership should have a significant impact on CME currency volume, adding depth and liquidity, according to Richard Sears, managing director for foreign exchange in the products and services division of the CME.
“We’ve displayed [our data] in spot equivalent terms,” he says. “We now quote it the way the cash [forex] markets do. It takes futures contracts and strips the interest-rate bit out so [traders] can compare futures prices to spot prices.”
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