Singapore overtakes Japan as Asia's biggest Forex market
Published on: Monday, July 06, 2015
Kota Kinabalu: Singapore has overtaken Japan as Asia's biggest Foreign Exchange Market (Forex) centre for the first time as trading surged in the past three years.The main Forex trading cities are London, New York, Singapore and Tokyo.The island nation has been the choice of employment destination of Sabahans keen to hone their talents in this field or to excel in international financial affairs as the Singapore dollar is strong and the city state is closer to their home state.
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CEO Andrew Lim of C7 Traders Singapore Pte Ltd said this in his presentation at the recent China-Asean Top CEO Business Summit held here at the Ming Garden Ballroom in conjunction with the launch of the 14th Asia Pacific International Entrepreneur Excellence Award 2015.He was speaking at the event's forum entitled 'One Belt, One Road; Business Opportunities and Challenges.'The 'One Belt, One Road' involved 60 countries in the Maritime Silk Road to the Overland Silk Road from China up to Venice in Italy and there would be a lot of competition and opportunities that lie within it.He said this was important for Asean and Singapore which has gain in status, as more countries are prepared to trade in renminbi in commerce deals with China, including Malaysia.
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Businesses should identify their own needs and the needs in China in order to complement each other and avoid competition.Malaysians are encouraged to use renminbi in their trade with China to help mitigate the volatility of foreign exchange especially in the current economic situation.
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The renminbi is a more stable currency in exchange to the ringgit, hence it is to the traders advantage to use renminbi as it is more predictable and consistent.Since 2012 Malaysia has accepted bank clearing in renminbi and established the mechanism to use renminbi as trade settlement currency between Malaysia and China.The Bank of China Bhd was appointed as the renminbi clearing bank to provide the services approved by China's Central Bank.Many other countries are using renminbi in their trading such as Australia and a few European countries, and that Malaysia could also explore to use currency for trading with these countries.Malaysia's export to China amounted to US$23.4 billion in 2014 and as of the first quarter of this year, it totalled US$7.89 billion, led by electrical and electronics products which constituted 46.7 per cent followed by chemical and palm oil.Malaysia is targeting to expand its bilateral trade and investment with China to US$160 billion by 2017 from US$101 billion at present.Lim explained that in the international financial scene, a Foreign Exchange Market is known as Forex (FX), and it is a marketplace where the world's various currencies are traded with the involvement of banks, central banks, institutional investors, currency speculators, corporations and retail investors.As a result of its incredible market volume and fluidity, the Forex market has become the largest and most significant financial market in the world.As the largest and most liquid financial market in the world, FX market trades in a day, what Wall Street trades in one month with opening of market from Sydney and Singapore ending with New York.The average daily turnover in global FX markets is estimated at more than $4 trillion. There are seven major currencies pair to choose from and many more second tier and other pairs of currencies.Forex markets are open 24 hours unlike the stock market which is open during normal business hours.Singapore has worked hard to establish itself as a hub for Forex trading and part of this emergence is due to the increasing importance of Asian currencies.The most traded currencies are US dollar, euro, yen and sterling pound.Stay up-to-date by following Daily Express’s Telegram channel.
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