The China Foreign Exchange Trade System (CFETS) is a platform that facilitates foreign exchange trading in China. It's a crucial part of the country's financial infrastructure.
CFETS was established in 2015 to centralize and standardize foreign exchange trading. This move aimed to increase transparency and reduce risks in the market.
The system allows banks and other financial institutions to trade foreign exchange with each other in a secure and efficient manner. This has helped to promote a more stable and liquid foreign exchange market in China.
CFETS operates through a network of banks and financial institutions, providing a platform for them to buy and sell foreign currencies.
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Features and Updates
CFETS provides a range of services, including issuance, trading, information, and post-trade for RMB-denominated interest rates, exchange rates, and related products in cash and derivatives markets.
It was founded in 1994 and has been utilizing advanced information technology to facilitate its operations.
On every business day, CFETS publishes market benchmarks such as the RMB Central Parity Rate and Shanghai Interbank Offered Rate (SHIBOR).
The system also publishes the CFETS RMB Index, Loan Prime Rate (LPR), RMB Reference Rate, Bond Indices, and yield curves, offering reference prices for the market.
These reference prices are crucial for market participants, including banks, investors, and businesses, to make informed decisions.
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Frequently Asked Questions
Who owns CFETS?
CFETS is owned by the People's Bank of China (PBC), a not-for-profit entity directly affiliated with the PBC.
What are the foreign exchange controls in China?
China has strict foreign exchange controls, prohibiting the circulation of foreign currencies other than the RMB in the domestic market. Foreign exchange transactions and international settlements are heavily regulated within its borders
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