China Foreign Exchange Trade System and Reuters (RTRSY) have launched a new foreign exchange trading system.

Alex Hungate, managing director of Reuters Asia, said, "The new CFETS system paves the way for the CNY and foreign currency pair trading and is an important milestone for the development of the inter-bank FX market. Reuters is honoured to have been able to contribute to the growth of China's financial markets in what will be a significant evolution for the trading of the Yuan. This successful partnership with CFETS combines their central role in China’s inter-bank market and the global leadership of Reuters in foreign exchange transaction systems."

CFETS member banks will now be able to access and trade in real-time the Yuan and five global currency pair prices. Banks will have a choice of mechanisms to bid or access prices- one click trading, request for quote or limit orders. Initially there are five currency pairs being offered, the Chinese Yuan against the US Dollar, Japanese Yen, Hong Kong Dollar, Euro, and Sterling.

To support the evolution of the Chinese foreign exchange market, CFETS chose Reuters to develop its new foreign exchange trading system, following an international tender.

The CFETS portal is based on a version of Reuters Electronic Trading platform customised for CNY trading. At present, 21 market-makers have completed the development of the API interface and today they started automated and programmed quotation and trading of the CNY on the new system.

Founded in 1994 as an intermediary in the inter-bank foreign exchange market in China, CFETS has built infrastructure for China’s inter-bank market. Since July 2005, when China started to reform its CNY exchange rate mechanism, new inter-bank foreign exchange instruments and trading patterns have been gradually introduced, along with the market-making system.

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