In line with its Vision 2028 and a commitment to building an innovative and inclusive digital financial ecosystem, the State Bank of Pakistan (SBP) is set to launch the ‘FX Matching’ platform, a Centralized Foreign Exchange (FX) Trading Platform for the interbank FX market. The primary objective is to provide a centralized trading platform offering FX trading on an anonymous basis with real-time price visibility.
The introduction of the FX Matching platform is a crucial step towards enhancing the depth and transparency of the interbank FX market. To formalize the launch, the SBP has issued instructions for Authorized Dealers (ADs), outlining key features and guidelines for the platform.
The FX Matching platform will be accessible to all ADs for interbank USD-PKR trading, allowing participants to engage in anonymous trading, place quotes, and execute trades without revealing their identities. Counterparties will be disclosed after a trade is matched, promoting transparency in the process.
Participants on the platform will have visibility of the best bid and offer quotes, with the best executable quote subject to counterparty limit availability. Each participant can set credit limits for their counterparties on the FX Matching platform. Trading will be conducted for a minimum lot size of $500,000 and multiples thereof, with bid or offer prices remaining firm until canceled by the quoting participant.
Effective January 29, 2024, it will be mandatory for ADs to use FX Matching or FXT Dealing for outright interbank FX transactions impacting Foreign Exchange Exposure Limit (FEEL). FX Swap transactions concluded with the same counterparty will continue under current practices.
Participants are urged to exercise caution in placing bids/offers, executing transactions, and monitoring orders on the platform to avoid errors. All deals executed on FX Matching and FXT Dealing will be reported electronically to SBP in real time, ensuring transparency and compliance.
The SBP’s initiative with the FX Matching platform signifies a significant move towards a more transparent and efficient interbank FX market, aligning with its broader vision for a digital financial ecosystem.
