Australia & New Zealand Bank (China) has become the second foreign bank to trade gold futures on the Shanghai Futures Exchange, potentially heralding increased foreign participation in China’s gold-trading market.
ANZ China said in a statement Tuesday that it gained access to the gold futures trading platform at the SHFE upon becoming a member. Its admittance to the bourse indicates that China is opening up the gold-derivatives-trading sector, a trend that analysts said could spur further trading interest as more foreign banks get involved.
HSBC China was the first foreign bank to become to be allowed to trade gold futures as a member of the SHFE, in late July.
Although foreign bank memberships are so far limited to gold-futures trading, the SHFE may be able to carve out a bigger role in China’s gold market while gaining increased pricing power on global markets if it opens up its membership to more foreign banks, analysts said. Currently, spot gold trading is considerably more active than futures trading.
“Allowing foreign banks to trade on the SHFE may increase activity in the market and increase the interplay between the Chinese market and international markets,” said Shanghai Cifco Futures senior analyst Wang Zhouyi.
ANZ China, became a member of the Shanghai Gold Exchange in 2008, where it was the first foreign bank in China to launch Chinese-yuan-denominated gold-forward products, in 2010, and the first foreign lender to enter China’s interbank gold leasing market, it said in a statement.
ANZ China was established in 2010 as Australia & New Zealand Banking Group Ltd.’s (ANZ.NZ) locally incorporated subsidiary in China.
Shanghai, 23 August, 2011 (Dow Jones)
