CME Announces Unification of EBS Market NDF Trading Venues
December 11, 2023 - CME Group has announced that it plans to consolidate its two non-deliverable forward (NDF) liquidity pools situated on the EBS Market platform into a single trading hub, slated for launch in October 2024, contingent upon regulatory approval.
This strategic consolidation will converge market participants from diverse regulatory domains into an integrated global trading ecosystem. This move is poised to bolster overall market efficiency while “enhancing EBS's role as as the leading source of centralised liquidity and price discovery in NDFs”.
Paul Houston, Global Head of FX Products at CME Group, commented on the significance of this initiative, stating, "Amid continued fragmentation and rising complexity within the global FX market, the need for a unified, globally accessible primary trading venue in NDFs is greater than ever. Combining our two leading NDF trading platforms will improve access for participants around the world while expanding liquidity, improving price discovery and providing operational efficiencies for the marketplace."
EBS Market was the first venue to offer electronic NDF trading on a central limit order book in 2007. Customers have the ability to trade 1-month Asian NDFs, LatAm NDFs and African NDFs on the platform.
Lat week the CME also announced that it will launch FX Spot+, an all-to-all spot FX marketplace connecting cash market participants directly with CME's deep FX futures liquidity for the first time. This announcement, along with today's announcement of the consolidation of EBS' NDF marketplaces, are in line with CME's intention to adopt a more integrated FX business model under the stewardship of Paul Houston who was made the Global Head of FX Products in August this year. At the time, Tim McCourt, Senior Managing Director, Head of Financial & OTC Products, CME Group stated that, "[The CME] been working to create tighter alignment among all of our FX businesses since CME Group purchased EBS through its acquisition of NEX in 2018. This new structure [the realignment of its FX futures, options, cash and over-the-counter (OTC) FX businesses into a single unit] is the last step in that process and one that, we believe, will benefit our FX clients globally."
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