ICDX Launches 27 Currency Pair Contracts
Indonesia Commodity and Derivatives Exchange (ICDX), the leading futures exchange in Indonesia, has successfully obtained the approval to launch 27 currency pair contracts from the Commodity Futures Trading Regulatory Agency (COFTRA) on June 6, 2012.
The launch of the 27 currency pair contracts marks the new era for the commodity futures trading in Indonesia, for it will be the first financial contract ever traded on exchange after the amendment of the law that regulates the commodity futures trading last year in 2011.
The launch of exchange traded currency contracts enables Indonesian investors, business operators, and financial institutions to manage their foreign reserves and take advantage of the price movement of those currencies.
As reported by the local news, at this moment, currency trading interbank in Indonesia mounts up to US$400 – $500 million on a daily basis, while offshore transactions sums up to staggering US$2 billion on a daily basis.
“We believe that through the introduction of the currency contracts, now, Indonesian investors and institutions have more economical reason to deposit their foreign reserves back in Indonesia, instead of somewhere else” said Megain Widjaja, Chief Executive Officer at ICDX.
The launch of the new contracts is expected to support the Indonesian Central Bank policy to gather back foreign reserves from export activities.
“The vast offering on currency pairs will allow market participants to actively engage in currency trading, managing their foreign reserves exposures against other currencies, and most importantly, attract their foreign reserves back in Indonesia”