3 thoughts on “The development prospects of foreign exchange”
Yvonne
In recent years, the foreign exchange market has been favored by more and more people, becoming the new darling of investors, and foreign exchange transactions have also become the largest financial investment market today. These are closely related to the characteristics of the foreign exchange market itself. This article starts with its characteristics and status quo, and then puts forward the strategic concept of stable profitability in the foreign exchange market, and the practical value of the concept. The global foreign exchange market supervision has become increasingly strict since last year. Developed countries such as Europe and the United States have made a series of tightening policies, and there are also restrictions on mergers and acquisitions and restrictions on IB business. The Chinese market is not in the center of the storm. At the same time, due to its special nature, the industry’s popularity is still unrelatial, which can be seen from this year’s financial expo. Under the trend of global regulatory tightening, the Chinese market “alone” is not accidental. Since 2014, the domestic economic growth is not tepid. The stock market has crossed the warehouse and hurts people’s hearts. House prices have not been able to get on the car too fast. Domestic pseudo -financial products have also faced cleanup and rectification. Under the trend of the devaluation of the renminbi, domestic funds seek new value preservation channels. With their own characteristics and advantages, the foreign exchange industry has become the darling of these funds to catch up. The prospects for China’s foreign exchange industry Although the Chinese market is still immature compared with the global foreign exchange market, we cannot ignore its broad prospects. Despite the statistical data in China, China’s monthly transaction volume accounts for less than 0.5%of the global ratio (the average monthly trading volume of the world in 2013 was US $ 16.6 million, and the maximum monthly month in China was more than 700 billion US dollars). However, overseas analysts believe that the actual transaction value is far greater than this data. At present, at least 20 % of transactions are generated in non -statistical areas, and the transaction volume from China has a large part. It, from the perspective of the demand group, under the conditions of China’s personal income, the further diversified development of investment channels, and the convenience of exit, and other conditions, the huge demand group in China’s retail foreign exchange market already owns. From the perspective of investment types, although the annual income level of Chinese stock market investors is lower than that of the Japanese, the investment scale of investors is relatively high. And data shows that 78.6%of Chinese individual investors participating in stock transactions are the main reason for the price difference between buying and selling stocks. This is a huge customer potential for the potential open Chinese retail foreign exchange market. The main trend of China’s foreign exchange industry The foreign exchange industry has great potential to develop. At the same time, under the guidance of market behavior, more brokerage behavior decisions have begun to centered on customer needs. A few years ago, operating a company only obtained the quotation from other brokers and performed a BOOK execution on its platform. But now, this can no longer meet the needs of Chinese brokers. These companies are now seeking better offer supply, better large -scale order execution, better order completion rate, better liquidity, and better support. This will become one of the development trends of the Chinese foreign exchange market in the future. The other trend is that the broker will invest more attention in terms of technology and connection quality. The stagnation of data per minute and the hidden concern of liquidity will become a stumbling block on the road of brand building. As a result, more and more brokers began to realize the importance of using high -quality data centers and high -end servers. In the past, low -end and poor performance virtual machines will be replaced in large areas. Department brokers also obtained low latency from New York or London, with no interruption of high -quality market quotation. 2019 Global Foreign Exchange Industry Development Exhibition 1. Implementation of the new regulatory system The major regulatory systems began to tighten regulatory errors since last year, but the implementation of some measures will be early next year. For example, 27 member states such as Britain, Cyprus, Germany and other European Union are waiting for the “Revised EU Financial Tool Market Guidance” (MIFID II) will be implemented on January 3, 2018. The “mother law” of new financial derivatives such as contracts. Therefore, for the European retail foreign exchange and difference contracts, it will be a major test at the beginning of next year. At the same time, Britain will also become the main points of attention under the new regulatory system. Nearly 40%of the world’s foreign exchange trading volume comes from London, England. As a global large -scale broker gathered in a heavy town, London has announced the new regulation consultation opinion from the British Financial Market Behavior Regulatory Authority (FCA) at the end of last year. It is the topic of discussions in the industry. Finally, Australia in the southern hemisphere is also a focus point. In the first quarter of this year, after the Australian government’s regulatory regulations must be isolated through retail foreign exchange customer funds, the Australian Securities and Trading Commission (ASIC) brokers seemed to have won the favor and trust of more investors. The new regulatory system is no stranger to the industry, and it also gives brokers and investors a lot of adaptation time. But starting next year, whether the true redeem and implementation of a series of measures will cause the industry’s chain response, it is also the focus of the attention of all parties. There is no doubt that global regulatory tightening will be the top priority of 2018, and brokers will continue to adjust their operating strategies to respond. 2. Transaction volume changes Since 2017, the world’s major retail foreign exchange trading volume has changed. This is an inevitable result caused by a series of comprehensive factors such as instability in the foreign exchange industry and market unstable and rigorous supervision. From the perspective of large areas, the data we collected show that the transaction volume of Australian retail foreign exchange brokers has risen sharply, and the United States and the United Kingdom have declined to varying degrees. In addition, Britain is in the center of regulatory storm, which seriously affects the growth of transaction volume, and it is expected that further decline in 2018 is expected to decline. It is foreseeable that with the implementation of the new regulations of the British and other EU countries, the market share of retail foreign exchange brokers may gradually transfer from the UK, which seems unavoidable. As for the US market, we know that since the financial crisis in 2008, US regulators have been in strict supervision of the retail foreign exchange industry, which has also led many brokers to be forced to withdraw from the US market, including the withdrawal of Fuhui Group (FXCM) early this year. For the US retail foreign exchange industry, this is an iconic event and a turning point. 3. Industry mergers and acquisitions In the current fierce competition and strict regulatory environment, each broker is facing multiple operating pressures. For small -scale brokers, competing with a strong financial agent, the pressure is very huge. Many small brokers may eventually be forced to sell assets or seek the path of “holding their thighs” to maintain the company’s normal operation. In statistics, since early 2017, the global retail foreign exchange industry and the surrounding industrial chain, the acquisition and merger cases between the industry is not less than 20. Obviously, the trend of mergers and acquisitions will continue. In 2018, more mergers and acquisitions may occur because the regulatory environment has seriously squeezed the living space of small brokers. 4. Pioneering customer channels In new customer channels will be a major challenge that each regulatory broker needs to face after the implementation of the new regulatory regulations. In a market environment that is restricted by the prohibition of funds, transaction leverage reduction, and transparent IB system, it is a key factor in determining the success or failure of 2018 in 2018. Although the market space is wide, the market share is also limited. When traditional attracting customers cannot be used, quickly developing new customer channels to seize the market will be the strategic focus of these brokers in 2018. 5. Copy changes in regulatory Unfortunately, because the supervision details of various countries are different, there is no good solution at present to all brokers around the world. However, we can take the initiative to pay attention to how large retail foreign exchange brokers deal with these changes in terms of legal affairs and operations. In addition, brokers may adjust their business corresponding to changes in regulatory measures, which requires attention. Analysis of the current status of China’s foreign exchange market The current foreign exchange market in China is a closed market system that is controlled by the interbank market as the center at the same time. In other issues, we need to increase the commercialization reform of state -owned banks, gradually relax the control of foreign exchange inventory, improve the foreign exchange intervention mechanism of central banks, and promote the fair competition of various banking industries. The foreign exchange market in China is an important part of China’s financial market. In improvement of exchange rate formation mechanism, promoting RMB exchanges, service financial institutions, promoting changes in macro -control methods, and improvement of the improvement of the financial market system The role of replacement. Since 1994, my country’s foreign exchange market has transitioned from a foreign exchange market to a bank interbank foreign exchange market with the China Foreign Exchange Trading Center as its core, which is undoubtedly a major progress in my country’s foreign exchange market. The lack of development in my country’s foreign exchange market The foreign exchange market in our country mainly refers to the market where banks are settled and sold, which are usually called domestic banks in the foreign exchange market. According to national regulations, financial institutions shall not conduct transactions between RMB and foreign currency outside the market. However, for transactions between different foreign exchange, domestic banks can freely participate in the international market transactions without policy restrictions. In 1994, China’s foreign exchange management system was reforming a major reform. As one of the measures for reform, it adopted a promotion method to establish a unified national inter -inter -interbank foreign exchange market, thereby completely changing the situation of market division and incomplete exchange rates, laying the market Supply and demand, a single, management floating exchange rate basis. The choice of market models fully considers the principles of gradual, unified, controllable, and effective, and develops a transaction method of “separate offers, matching transactions, and centralized liquidation” on the basis of adjusting the market. Many years of practice have fully proved that the current inter -bank foreign exchange market has played an important role in serving financial institutions, maintaining the stability of the RMB exchange rate, supporting economic growth and reform and opening up. Judging from the operation of my country’s foreign exchange market for many years, the design of its basic framework is reasonable, but there are still some disadvantages during the transaction. 1. The free choice of the trader Theoretically, as long as there is no negative external nature, the free choice of market entities is always conducive to maximizing social interests. Generally speaking, foreign exchange transactions on the foreign exchange market basically do not generate external economies. The most favorable transaction methods and transaction objects of transaction participants are most consistent with economic efficiency, but the current foreign exchange field trading system forced foreign exchange banks must be on the exchange. The bidding match, its transaction object is limited to the exchange member. This system hinders the realization of the free will of market participants, and the failed to achieve some possible transaction benefits, which will damage market efficiency. 2. The continuity of the transaction cannot be guaranteed The interbank foreign exchange market, which is traded in a single on -site transaction, is limited by the business time and trading opponents of the exchange, and cannot guarantee the continuous development of foreign exchange transactions. The discomfort of the transaction is not conducive to stabilizing market expectations. For example, the exchange rate is prone to jump or volatility when the market is opened or closed, thereby increasing the risk of the exchange market. In addition, the discontinued transaction also enables traders to pay high waiting costs due to unable to transaction. 3. The market coverage is narrow First of all, the inter -bank foreign exchange market of the on -site transaction is limited by trading venues. Although the China Foreign Exchange Trading Center implements a computer -connected transaction and established a network of trading systems and remote trading stations in more than 20 large and medium -sized cities, there are still a large number of regions without Unicom trading networks. Secondly, the foreign exchange market of the on -site transaction is also limited by the exchange seat. The China Foreign Exchange Trading Center implements a member system. Each bank and its branches must apply for a seat and send traders to the transaction in the general center and the branch center. State -owned commercial banks generally only have the head office and authorized branches to enter this market. A large number of financial branches without trading seats cannot participate directly. As a result, on the one hand, the number of market participation is small, simple structure, lack of competitiveness, and is not conducive to the improvement of market efficiency; on the other hand, foreign exchange transactions that are quite large areas cannot be directly included in this transaction network, but instead of higher -level banks or agents. The membership agent of a qualified trading center increased the transaction fee. 4. The cost of transaction organization in the field is higher First of all, in terms of free transactions on the venue, there is a more complex organizational form. Maintaining the normal operation of the exchange and the centralized matching and liquidation of the transaction requires huge costs. Secondly, all banks’ inter -bank foreign exchange transactions must be carried out through the China Foreign Exchange Trading Center, which makes China Foreign Exchange Trading Center a monopoly intermediary organization in the interbank foreign exchange market. Under the conditions of lack of competition, the trading center does not reduce the economic motivation to reduce costs. Based on the above factors, the organizational cost of the market in China is higher. It is estimated that the organizational costs of China’s foreign exchange market are about 10 times higher than the foreign market. 5. The central bank’s excessive intervention in the foreign exchange market has caused distortion of supply and demand in the foreign exchange market . Generally speaking, the central government is only a macro -controller in the foreign exchange market. The main media of the main body and the foreign exchange market is in the center of the center, engaged in buying and selling and self -employed trading. The characteristics of modern agents in my country determine the distortion of intervention and functions of the central bank in the foreign exchange market. The central bank implements a proportion of the proportion of the balance of foreign exchange bank exchange settlement turnover balance. In this way, the difficulty of macro -control in the designated bank system in foreign exchange is increased. As a result, the central bank becomes the largest buyer and the only buyer in the market. This passive market intervention is only a large fluctuating central bank in the market. The function of active intervention is deviated. At the same time, in the process of stabilizing the exchange rate through the open market operation and the acquisition of foreign exchange selling local currency, because the domestic lack of the domestic coin open market business operations and facilities, the central bank’s selling local currency in the foreign exchange market is equivalent to investing in currency to the country. This The current situation of high inflation in my country is even more worse. The development and improvement of my country’s foreign exchange market In from the main problems facing the current Chinese foreign exchange market, the difficulty of the development of the foreign exchange market is that the renminbi has not yet achieved capital projects to be exchanged. We cannot copy the development of the foreign exchange market in developed countries. Model; the settlement and sales system determines that the reform of my country’s foreign exchange market must maintain the relatively stable RMB exchange rate, and the reform of the settlement and sales system directly determines the reform of the foreign exchange market. It is necessary to consider how to carry out the reform of the foreign exchange market under the current foreign exchange management system, but also consider the actual process that can be convertible for capital items. 1. Increase the commercialization of state -owned banks The fundamental crux of the current ownership of state -owned foreign exchange banks lies in the unclear property rights, which causes the incompleteness of the operator’s incentives and restraint mechanisms, and is not adapted to the establishment of the dealer system. The fundamental way to solve this problem lies in further implementation of joint -stock systems for state -owned banks, pushing state -owned banks to the stock market and gradually reducing the proportion of state shares at a suitable time, thereby clarifying the property rights of state -owned banks. On the basis of the clarity of property rights, through the rules of law, we can establish a reasonable governance structure so that everyone can effectively restrain and motivate the operator. Such a bank is a commercial bank that truly operates in accordance with the requirements of the market economy. 2. Gradually relax foreign exchange inventory control The current settlement of foreign exchange turnover ratio management with obvious planned economy and traces of foreign exchange shortage. With the increase in China’s economic opening level Large, the state’s management of foreign exchange funds is becoming more and more difficult; on the other hand, the continuous annual surplus of China’s international income and expenditure has gradually changed the situation of foreign exchange shortages in the past. Under new circumstances, the management of foreign exchange turnover ratio limit management has gradually lost its original meaning; more importantly, this control has harms the competitiveness of the Chinese banking industry and does not adapt to the requirements of the establishment of a trade system. Therefore, there is an inevitable reform of foreign exchange inventory control to foreign exchange banks. In further the reform of the foreign exchange system, you can consider gradually relaxing the floating limit of the proportion of foreign exchange turnover, so that foreign exchange banks have a greater freedom to choose foreign exchange asset inventory; at the same time Foreign exchange banks can arrange foreign exchange asset portfolios in a longer period of time. When conditions are ripe, China should eventually abandon this control to ensure that foreign exchange banks have sufficient autonomy and lay the foundation for the establishment of a dealer system. 3. Promote the competition of foreign exchange banks and prevent monopoly Under the conditions of incomplete capital flow, a large part of the current Chinese foreign exchange market transactions are concentrated in a few state -owned banks such as Bank of China, causing the possibility of monopoly. This is also due to historical reasons, and on the other hand, it is formed by control. In order to establish an effective trader system, this situation should be changed. It should break the policies enjoyed by Bank of China and other state -owned foreign exchange banks, and implement the same treatment for various foreign banks and non -bank financial institutions that conduct foreign exchange transactions, so that banks can compete freely on the basis of equality. At the same time, capital projects can be considered conditionally, increasing the elasticity of foreign exchange supply, and increasing the difficulty of monopoly. 4. The combination of the RMB exchange rate mechanism and the development of the foreign exchange market In in a sense, the process of operating the foreign exchange market is the process of exchange rate generation. Therefore, the problem of the generation mechanism of the RMB exchange rate is the core issue of the foreign exchange market operation. The flexible exchange rate generation mechanism can play a role in regulating foreign exchange supply and demand and providing signal for the central bank’s macro -control. One of the contents of the reform of the foreign exchange management system in 1994 is to implement a management floating exchange system based on market supply and demand. The formation of exchange rates reflects the supply and demand of the foreign exchange market to a certain extent, but the formation mechanism of the exchange rate is not perfect. Due to the implementation of mandatory foreign exchange and sales of domestic enterprises, the central bank assumes the responsibility of the daily foreign exchange supply and demand. The RMB exchange rate is currently undergoing a single stating of changes in the US dollar. From recent years, the US dollar has changed significantly, and the floating rate of the RMB exchange rate is small, forming an official exchange rate that does not match foreign exchange supply and demand. It is necessary to improve the RMB exchange rate generation mechanism and increase the marketization of the exchange rate generation mechanism. Expand the inter -bank market exchange rate floating range, such as allowing the exchange rate to fluctuate by one or two hundred points per day. Adjusting the bank’s exchange and sales turnover foreign exchange position management policy, in the near future, the lower limit of the bank settlement of the bank’s exchange week can be adjusted to zero, allowing banks to hold zero inch; in the middle period, the bank’s upper limit of the bank holding foreign exchange positions should be gradually expanded. In the end Cancel the restrictions on the bank holding foreign exchange positions. Reform and compulsory foreign exchange settlement system, such as expanding the scope of enterprises that allow foreign exchange income to retain frequent projects, increase the limits of foreign exchange, and extend the width limit of foreign exchange settlement. 5. Improve the foreign exchange intervention mechanism of the Central Bank The macro -regulators of the Central Bank as a foreign exchange market should not be excessive or frequent intervention in the market, so that market participants should freely determine the transaction. In view of the current international reserves in my country, which has a strong ability to resist domestic foreign exchange speculation risks, the central bank should relax the restrictions on the number of foreign exchange cents held by the designated foreign exchange bank, expand the amount of foreign exchange free trading of banks, and make them truly become the foreign exchange trading market. The main body is used to give play to its buffer adjustment function in the foreign exchange market. This is of great significance to the healthy development of the foreign exchange market. From the perspective of foreign experience, the central bank often adopts some indirect means to intervene, that is, if the foreign exchange market is purchased to sell the local currency in the foreign exchange market, the short -term Treasury bonds will be thrown in the national bond market. Return to the local currency, so that the liquidity of domestic currency does not expand due to the operation of the foreign exchange market, thereby reducing the adverse effects of intervention in the foreign exchange market on the local currency policy. In order to effectively interfere with the foreign exchange market, my country should learn from foreign experience and establish a corresponding RMB open market. With the public operation of the foreign exchange market, increase the buffer room for foreign exchange intervention. The foreign exchange market is the market that does not want to leave once after understanding. In the era of development in China, it is a gospel of investors and a gospel of financial practitioners!
China’s foreign exchange is still very promising. The outline of the “Thirteenth Five -Year Plan” in 2016 also mentioned in the chapter of “building a comprehensive openness” chapter, and it also mentioned that it has expanded the two -way opening of the financial industry. The orderly realization of RMB capital projects can be exchanged, improved exchanges, free use, steadily advanced the internationalization of RMB, and advanced RMB capital. Gradually establish a negative list system for foreign exchange management. Relax the restrictions on overseas investment exchange and improve the management of enterprises and individuals.
In recent years, the foreign exchange market has been favored by more and more people, becoming the new darling of investors, and foreign exchange transactions have also become the largest financial investment market today. These are closely related to the characteristics of the foreign exchange market itself. This article starts with its characteristics and status quo, and then puts forward the strategic concept of stable profitability in the foreign exchange market, and the practical value of the concept.
The global foreign exchange market supervision has become increasingly strict since last year. Developed countries such as Europe and the United States have made a series of tightening policies, and there are also restrictions on mergers and acquisitions and restrictions on IB business. The Chinese market is not in the center of the storm. At the same time, due to its special nature, the industry’s popularity is still unrelatial, which can be seen from this year’s financial expo.
Under the trend of global regulatory tightening, the Chinese market “alone” is not accidental. Since 2014, the domestic economic growth is not tepid. The stock market has crossed the warehouse and hurts people’s hearts. House prices have not been able to get on the car too fast. Domestic pseudo -financial products have also faced cleanup and rectification. Under the trend of the devaluation of the renminbi, domestic funds seek new value preservation channels. With their own characteristics and advantages, the foreign exchange industry has become the darling of these funds to catch up.
The prospects for China’s foreign exchange industry
Although the Chinese market is still immature compared with the global foreign exchange market, we cannot ignore its broad prospects. Despite the statistical data in China, China’s monthly transaction volume accounts for less than 0.5%of the global ratio (the average monthly trading volume of the world in 2013 was US $ 16.6 million, and the maximum monthly month in China was more than 700 billion US dollars). However, overseas analysts believe that the actual transaction value is far greater than this data. At present, at least 20 % of transactions are generated in non -statistical areas, and the transaction volume from China has a large part.
It, from the perspective of the demand group, under the conditions of China’s personal income, the further diversified development of investment channels, and the convenience of exit, and other conditions, the huge demand group in China’s retail foreign exchange market already owns.
From the perspective of investment types, although the annual income level of Chinese stock market investors is lower than that of the Japanese, the investment scale of investors is relatively high. And data shows that 78.6%of Chinese individual investors participating in stock transactions are the main reason for the price difference between buying and selling stocks. This is a huge customer potential for the potential open Chinese retail foreign exchange market.
The main trend of China’s foreign exchange industry
The foreign exchange industry has great potential to develop. At the same time, under the guidance of market behavior, more brokerage behavior decisions have begun to centered on customer needs. A few years ago, operating a company only obtained the quotation from other brokers and performed a BOOK execution on its platform. But now, this can no longer meet the needs of Chinese brokers. These companies are now seeking better offer supply, better large -scale order execution, better order completion rate, better liquidity, and better support. This will become one of the development trends of the Chinese foreign exchange market in the future.
The other trend is that the broker will invest more attention in terms of technology and connection quality. The stagnation of data per minute and the hidden concern of liquidity will become a stumbling block on the road of brand building. As a result, more and more brokers began to realize the importance of using high -quality data centers and high -end servers. In the past, low -end and poor performance virtual machines will be replaced in large areas. Department brokers also obtained low latency from New York or London, with no interruption of high -quality market quotation.
2019 Global Foreign Exchange Industry Development Exhibition
1. Implementation of the new regulatory system
The major regulatory systems began to tighten regulatory errors since last year, but the implementation of some measures will be early next year. For example, 27 member states such as Britain, Cyprus, Germany and other European Union are waiting for the “Revised EU Financial Tool Market Guidance” (MIFID II) will be implemented on January 3, 2018. The “mother law” of new financial derivatives such as contracts. Therefore, for the European retail foreign exchange and difference contracts, it will be a major test at the beginning of next year.
At the same time, Britain will also become the main points of attention under the new regulatory system. Nearly 40%of the world’s foreign exchange trading volume comes from London, England. As a global large -scale broker gathered in a heavy town, London has announced the new regulation consultation opinion from the British Financial Market Behavior Regulatory Authority (FCA) at the end of last year. It is the topic of discussions in the industry.
Finally, Australia in the southern hemisphere is also a focus point. In the first quarter of this year, after the Australian government’s regulatory regulations must be isolated through retail foreign exchange customer funds, the Australian Securities and Trading Commission (ASIC) brokers seemed to have won the favor and trust of more investors.
The new regulatory system is no stranger to the industry, and it also gives brokers and investors a lot of adaptation time. But starting next year, whether the true redeem and implementation of a series of measures will cause the industry’s chain response, it is also the focus of the attention of all parties. There is no doubt that global regulatory tightening will be the top priority of 2018, and brokers will continue to adjust their operating strategies to respond.
2. Transaction volume changes
Since 2017, the world’s major retail foreign exchange trading volume has changed. This is an inevitable result caused by a series of comprehensive factors such as instability in the foreign exchange industry and market unstable and rigorous supervision. From the perspective of large areas, the data we collected show that the transaction volume of Australian retail foreign exchange brokers has risen sharply, and the United States and the United Kingdom have declined to varying degrees.
In addition, Britain is in the center of regulatory storm, which seriously affects the growth of transaction volume, and it is expected that further decline in 2018 is expected to decline. It is foreseeable that with the implementation of the new regulations of the British and other EU countries, the market share of retail foreign exchange brokers may gradually transfer from the UK, which seems unavoidable. As for the US market, we know that since the financial crisis in 2008, US regulators have been in strict supervision of the retail foreign exchange industry, which has also led many brokers to be forced to withdraw from the US market, including the withdrawal of Fuhui Group (FXCM) early this year. For the US retail foreign exchange industry, this is an iconic event and a turning point.
3. Industry mergers and acquisitions
In the current fierce competition and strict regulatory environment, each broker is facing multiple operating pressures. For small -scale brokers, competing with a strong financial agent, the pressure is very huge. Many small brokers may eventually be forced to sell assets or seek the path of “holding their thighs” to maintain the company’s normal operation.
In statistics, since early 2017, the global retail foreign exchange industry and the surrounding industrial chain, the acquisition and merger cases between the industry is not less than 20. Obviously, the trend of mergers and acquisitions will continue. In 2018, more mergers and acquisitions may occur because the regulatory environment has seriously squeezed the living space of small brokers.
4. Pioneering customer channels
In new customer channels will be a major challenge that each regulatory broker needs to face after the implementation of the new regulatory regulations. In a market environment that is restricted by the prohibition of funds, transaction leverage reduction, and transparent IB system, it is a key factor in determining the success or failure of 2018 in 2018. Although the market space is wide, the market share is also limited. When traditional attracting customers cannot be used, quickly developing new customer channels to seize the market will be the strategic focus of these brokers in 2018.
5. Copy changes in regulatory
Unfortunately, because the supervision details of various countries are different, there is no good solution at present to all brokers around the world. However, we can take the initiative to pay attention to how large retail foreign exchange brokers deal with these changes in terms of legal affairs and operations. In addition, brokers may adjust their business corresponding to changes in regulatory measures, which requires attention.
Analysis of the current status of China’s foreign exchange market
The current foreign exchange market in China is a closed market system that is controlled by the interbank market as the center at the same time. In other issues, we need to increase the commercialization reform of state -owned banks, gradually relax the control of foreign exchange inventory, improve the foreign exchange intervention mechanism of central banks, and promote the fair competition of various banking industries.
The foreign exchange market in China is an important part of China’s financial market. In improvement of exchange rate formation mechanism, promoting RMB exchanges, service financial institutions, promoting changes in macro -control methods, and improvement of the improvement of the financial market system The role of replacement. Since 1994, my country’s foreign exchange market has transitioned from a foreign exchange market to a bank interbank foreign exchange market with the China Foreign Exchange Trading Center as its core, which is undoubtedly a major progress in my country’s foreign exchange market.
The lack of development in my country’s foreign exchange market
The foreign exchange market in our country mainly refers to the market where banks are settled and sold, which are usually called domestic banks in the foreign exchange market. According to national regulations, financial institutions shall not conduct transactions between RMB and foreign currency outside the market. However, for transactions between different foreign exchange, domestic banks can freely participate in the international market transactions without policy restrictions. In 1994, China’s foreign exchange management system was reforming a major reform. As one of the measures for reform, it adopted a promotion method to establish a unified national inter -inter -interbank foreign exchange market, thereby completely changing the situation of market division and incomplete exchange rates, laying the market Supply and demand, a single, management floating exchange rate basis.
The choice of market models fully considers the principles of gradual, unified, controllable, and effective, and develops a transaction method of “separate offers, matching transactions, and centralized liquidation” on the basis of adjusting the market. Many years of practice have fully proved that the current inter -bank foreign exchange market has played an important role in serving financial institutions, maintaining the stability of the RMB exchange rate, supporting economic growth and reform and opening up. Judging from the operation of my country’s foreign exchange market for many years, the design of its basic framework is reasonable, but there are still some disadvantages during the transaction.
1. The free choice of the trader
Theoretically, as long as there is no negative external nature, the free choice of market entities is always conducive to maximizing social interests. Generally speaking, foreign exchange transactions on the foreign exchange market basically do not generate external economies. The most favorable transaction methods and transaction objects of transaction participants are most consistent with economic efficiency, but the current foreign exchange field trading system forced foreign exchange banks must be on the exchange. The bidding match, its transaction object is limited to the exchange member. This system hinders the realization of the free will of market participants, and the failed to achieve some possible transaction benefits, which will damage market efficiency.
2. The continuity of the transaction cannot be guaranteed
The interbank foreign exchange market, which is traded in a single on -site transaction, is limited by the business time and trading opponents of the exchange, and cannot guarantee the continuous development of foreign exchange transactions. The discomfort of the transaction is not conducive to stabilizing market expectations. For example, the exchange rate is prone to jump or volatility when the market is opened or closed, thereby increasing the risk of the exchange market. In addition, the discontinued transaction also enables traders to pay high waiting costs due to unable to transaction.
3. The market coverage is narrow
First of all, the inter -bank foreign exchange market of the on -site transaction is limited by trading venues. Although the China Foreign Exchange Trading Center implements a computer -connected transaction and established a network of trading systems and remote trading stations in more than 20 large and medium -sized cities, there are still a large number of regions without Unicom trading networks. Secondly, the foreign exchange market of the on -site transaction is also limited by the exchange seat. The China Foreign Exchange Trading Center implements a member system. Each bank and its branches must apply for a seat and send traders to the transaction in the general center and the branch center. State -owned commercial banks generally only have the head office and authorized branches to enter this market. A large number of financial branches without trading seats cannot participate directly. As a result, on the one hand, the number of market participation is small, simple structure, lack of competitiveness, and is not conducive to the improvement of market efficiency; on the other hand, foreign exchange transactions that are quite large areas cannot be directly included in this transaction network, but instead of higher -level banks or agents. The membership agent of a qualified trading center increased the transaction fee.
4. The cost of transaction organization in the field is higher
First of all, in terms of free transactions on the venue, there is a more complex organizational form. Maintaining the normal operation of the exchange and the centralized matching and liquidation of the transaction requires huge costs. Secondly, all banks’ inter -bank foreign exchange transactions must be carried out through the China Foreign Exchange Trading Center, which makes China Foreign Exchange Trading Center a monopoly intermediary organization in the interbank foreign exchange market. Under the conditions of lack of competition, the trading center does not reduce the economic motivation to reduce costs. Based on the above factors, the organizational cost of the market in China is higher. It is estimated that the organizational costs of China’s foreign exchange market are about 10 times higher than the foreign market.
5. The central bank’s excessive intervention in the foreign exchange market has caused distortion of supply and demand in the foreign exchange market
. Generally speaking, the central government is only a macro -controller in the foreign exchange market. The main media of the main body and the foreign exchange market is in the center of the center, engaged in buying and selling and self -employed trading. The characteristics of modern agents in my country determine the distortion of intervention and functions of the central bank in the foreign exchange market. The central bank implements a proportion of the proportion of the balance of foreign exchange bank exchange settlement turnover balance. In this way, the difficulty of macro -control in the designated bank system in foreign exchange is increased. As a result, the central bank becomes the largest buyer and the only buyer in the market. This passive market intervention is only a large fluctuating central bank in the market. The function of active intervention is deviated. At the same time, in the process of stabilizing the exchange rate through the open market operation and the acquisition of foreign exchange selling local currency, because the domestic lack of the domestic coin open market business operations and facilities, the central bank’s selling local currency in the foreign exchange market is equivalent to investing in currency to the country. This The current situation of high inflation in my country is even more worse.
The development and improvement of my country’s foreign exchange market
In from the main problems facing the current Chinese foreign exchange market, the difficulty of the development of the foreign exchange market is that the renminbi has not yet achieved capital projects to be exchanged. We cannot copy the development of the foreign exchange market in developed countries. Model; the settlement and sales system determines that the reform of my country’s foreign exchange market must maintain the relatively stable RMB exchange rate, and the reform of the settlement and sales system directly determines the reform of the foreign exchange market. It is necessary to consider how to carry out the reform of the foreign exchange market under the current foreign exchange management system, but also consider the actual process that can be convertible for capital items.
1. Increase the commercialization of state -owned banks
The fundamental crux of the current ownership of state -owned foreign exchange banks lies in the unclear property rights, which causes the incompleteness of the operator’s incentives and restraint mechanisms, and is not adapted to the establishment of the dealer system. The fundamental way to solve this problem lies in further implementation of joint -stock systems for state -owned banks, pushing state -owned banks to the stock market and gradually reducing the proportion of state shares at a suitable time, thereby clarifying the property rights of state -owned banks. On the basis of the clarity of property rights, through the rules of law, we can establish a reasonable governance structure so that everyone can effectively restrain and motivate the operator. Such a bank is a commercial bank that truly operates in accordance with the requirements of the market economy.
2. Gradually relax foreign exchange inventory control
The current settlement of foreign exchange turnover ratio management with obvious planned economy and traces of foreign exchange shortage. With the increase in China’s economic opening level Large, the state’s management of foreign exchange funds is becoming more and more difficult; on the other hand, the continuous annual surplus of China’s international income and expenditure has gradually changed the situation of foreign exchange shortages in the past. Under new circumstances, the management of foreign exchange turnover ratio limit management has gradually lost its original meaning; more importantly, this control has harms the competitiveness of the Chinese banking industry and does not adapt to the requirements of the establishment of a trade system.
Therefore, there is an inevitable reform of foreign exchange inventory control to foreign exchange banks. In further the reform of the foreign exchange system, you can consider gradually relaxing the floating limit of the proportion of foreign exchange turnover, so that foreign exchange banks have a greater freedom to choose foreign exchange asset inventory; at the same time Foreign exchange banks can arrange foreign exchange asset portfolios in a longer period of time. When conditions are ripe, China should eventually abandon this control to ensure that foreign exchange banks have sufficient autonomy and lay the foundation for the establishment of a dealer system.
3. Promote the competition of foreign exchange banks and prevent monopoly
Under the conditions of incomplete capital flow, a large part of the current Chinese foreign exchange market transactions are concentrated in a few state -owned banks such as Bank of China, causing the possibility of monopoly. This is also due to historical reasons, and on the other hand, it is formed by control. In order to establish an effective trader system, this situation should be changed. It should break the policies enjoyed by Bank of China and other state -owned foreign exchange banks, and implement the same treatment for various foreign banks and non -bank financial institutions that conduct foreign exchange transactions, so that banks can compete freely on the basis of equality. At the same time, capital projects can be considered conditionally, increasing the elasticity of foreign exchange supply, and increasing the difficulty of monopoly.
4. The combination of the RMB exchange rate mechanism and the development of the foreign exchange market
In in a sense, the process of operating the foreign exchange market is the process of exchange rate generation. Therefore, the problem of the generation mechanism of the RMB exchange rate is the core issue of the foreign exchange market operation. The flexible exchange rate generation mechanism can play a role in regulating foreign exchange supply and demand and providing signal for the central bank’s macro -control. One of the contents of the reform of the foreign exchange management system in 1994 is to implement a management floating exchange system based on market supply and demand. The formation of exchange rates reflects the supply and demand of the foreign exchange market to a certain extent, but the formation mechanism of the exchange rate is not perfect. Due to the implementation of mandatory foreign exchange and sales of domestic enterprises, the central bank assumes the responsibility of the daily foreign exchange supply and demand.
The RMB exchange rate is currently undergoing a single stating of changes in the US dollar. From recent years, the US dollar has changed significantly, and the floating rate of the RMB exchange rate is small, forming an official exchange rate that does not match foreign exchange supply and demand. It is necessary to improve the RMB exchange rate generation mechanism and increase the marketization of the exchange rate generation mechanism. Expand the inter -bank market exchange rate floating range, such as allowing the exchange rate to fluctuate by one or two hundred points per day. Adjusting the bank’s exchange and sales turnover foreign exchange position management policy, in the near future, the lower limit of the bank settlement of the bank’s exchange week can be adjusted to zero, allowing banks to hold zero inch; in the middle period, the bank’s upper limit of the bank holding foreign exchange positions should be gradually expanded. In the end Cancel the restrictions on the bank holding foreign exchange positions. Reform and compulsory foreign exchange settlement system, such as expanding the scope of enterprises that allow foreign exchange income to retain frequent projects, increase the limits of foreign exchange, and extend the width limit of foreign exchange settlement.
5. Improve the foreign exchange intervention mechanism of the Central Bank
The macro -regulators of the Central Bank as a foreign exchange market should not be excessive or frequent intervention in the market, so that market participants should freely determine the transaction. In view of the current international reserves in my country, which has a strong ability to resist domestic foreign exchange speculation risks, the central bank should relax the restrictions on the number of foreign exchange cents held by the designated foreign exchange bank, expand the amount of foreign exchange free trading of banks, and make them truly become the foreign exchange trading market. The main body is used to give play to its buffer adjustment function in the foreign exchange market.
This is of great significance to the healthy development of the foreign exchange market. From the perspective of foreign experience, the central bank often adopts some indirect means to intervene, that is, if the foreign exchange market is purchased to sell the local currency in the foreign exchange market, the short -term Treasury bonds will be thrown in the national bond market. Return to the local currency, so that the liquidity of domestic currency does not expand due to the operation of the foreign exchange market, thereby reducing the adverse effects of intervention in the foreign exchange market on the local currency policy. In order to effectively interfere with the foreign exchange market, my country should learn from foreign experience and establish a corresponding RMB open market. With the public operation of the foreign exchange market, increase the buffer room for foreign exchange intervention.
The foreign exchange market is the market that does not want to leave once after understanding. In the era of development in China, it is a gospel of investors and a gospel of financial practitioners!
China’s foreign exchange is still very promising.
The outline of the “Thirteenth Five -Year Plan” in 2016 also mentioned in the chapter of “building a comprehensive openness” chapter, and it also mentioned that it has expanded the two -way opening of the financial industry. The orderly realization of RMB capital projects can be exchanged, improved exchanges, free use, steadily advanced the internationalization of RMB, and advanced RMB capital. Gradually establish a negative list system for foreign exchange management. Relax the restrictions on overseas investment exchange and improve the management of enterprises and individuals.
Hello, about the prospect of foreign exchange development, I suggest you log in to foreign exchange eyes to understand.