Amidst increased industry competition, the CME group introduced a Spot+ trading platform to reduce trading volume and increase liquidity across 40 currency pairs, connecting cash and future markets. The company could offer traders tradable FX spot products.
CME Group, the world’s foremost regulated foreign exchange marketplace, is set to introduce a new spot currency trading platform, Spot+, designed to enhance liquidity across a broader spectrum of currency pairs by seamlessly connecting cash and futures markets. Anticipated for client testing in the latter half of the coming year, Spot+ aims to address diminishing trading volumes in the face of escalating industry competition.
This innovative platform will augment CME’s existing EBS spot trading platform, the primary hub for trading significant currencies against the US dollar. Spot+ seeks to bridge the liquidity gap by integrating the group’s currency futures trading business, encompassing 40 currency pairs. Paul Houston, CME’s global head of FX products, affirmed that Spot+ would offer spot traders access to CME’s FX futures akin to tradable FX spot products.
Despite a November rebound in currency trading activity on CME’s EBS platform from a two-year low, overall volumes remain historically depressed, with a 17% year-over-year decrease. Conversely, demand for CME’s FX futures and options has proven resilient, witnessing a 2% year-over-year increase in average daily volumes in November.
The launch of Spot+ is a pivotal move in consolidating CME’s FX products into a unified entity following its 2018 acquisition of EBS. In a landscape marked by heightened competition for FX spot trading volumes, Spot+ positions itself to revitalise market participation and uphold the significance of primary venues in the dynamic FX market.