Derivs - FX

The People’s Bank of China has scaled back the role of its daily fix for onshore China yuan, giving the market a greater role in forming the spot price of the U.S. dollar against CNY.

The Bank of England and Her Majesty’s Treasury are making changes to the terms of fx transactions with market counterparties.

The Indonesia Commodity and Derivatives Exchange has launched fx futures with 27 contracts.

Westpac has sold one-month U.S. dollar non-deliverable forwards against the Indian rupee at INR56.25, playing the view the rupee could rebound to 54.00, according to a research note from the firm.

Strategists expect the yen to weaken against the U.S. dollar as the potential for more monetary easing from the Bank of Japan increases, providing an opportunity to buy reverse knock-out calls on the pair.

Asia-based hedge funds and corporates are remaining on the fx sidelines, despite vol tracking lower on short-dated options referencing Asian currencies on the back of Greek election.

Deutsche Bank has won three awards in the 2012 Global Derivatives Awards, including Global Derivatives House of the Year. Nomura and UBS each earned two nods, in the annual awards for excellence as judged by the edit staff of Derivatives Week/Derivatives Intelligence.

The Hong Kong Monetary Authority introduced Friday a liquidity facility for authorized institutions dealing in China yuan-denominated bonds and fx forwards. It has also replaced its CNH risk management limit with a liquidity ratio for monitoring RMB liquidity positions.

Market officials are expecting greater flow in fx options referencing the Philippine peso after the country posted strong gross domestic product growth in the first half of 2012.

Global corporates with business interests in China are continuing to sell U.S. dollar, China onshore one-year yuan non-deliverable forwards with a CNY6.40 implied spot level to hedge against a possible depreciation in dollar, according to fx traders in Hong Kong.

The volume of fx derivatives contracts on India exchanges dropped 11% between March and May from a year earlier, despite volatility of the rupee.

Hedge funds have been buying U.S. dollar puts against emerging market and high beta G10 currencies this week. The trades position for a dollar retracement after risk aversion last week may have over-strengthened the greenback.