FXCM Adds ForexBaskets to its Retail Offering

FXCM announced today the introduction of foreign exchange baskets to its retail customers.

A foreign exchange or forex basket is comprised of a mix of several currencies, each initially starting with the same equivalent value. It allows traders to buy or sell a base currency, e.g. USD, against a basket of multiple currencies. The value of the basket will be determined by how the base currency performs vs the other currencies in the basket, since the time of the basket’s inception.

FXCM customers in all global regions, including the UK, Australia and South Africa, will initially be able to trade three different baskets: The Dollar Index Basket, The Yen Index Basket and The Emerging Markets Index Basket.

The Dollar Index basket reflects the change in value of the US dollar and is measured against a basket of major, highly-liquid currencies: the British pound (GBP), Euro (EUR), Japanese yen (JPY) and Australian dollar (AUD).

The Yen Index acts a Japanese benchmark and is designed to reflect the change in value of the Japanese yen against the Australian dollar (AUD) British pound (GBP), Euro (EUR) and Canadian dollar (CAD).

The Emerging Markets Index is designed to reflect the value of the USD against the Chinese Renminbi (CNY), Mexican Peso (MXN), Turkish Lira (TRY) and South African Rand (ZAR).

Brendan Callan, CEO of FXCM, commented: “Our customers typically trade different currencies at the same time to broaden their portfolio, diversify risk or hedge an existing position. Trading a basket of currencies offers them an efficient way to trade against multiple currencies. This reduces the risk of exposure or adverse movements in a single currency and lowers trade costs.”

Real-time payments become the new norm in Australia, with Europe set to follow suit

The rapid speeds of modern technology have created the expectation amongst consumers and businesses that payments need to be transferred instantaneously at the push of a button. Global infrastructure provider SWIFT made this a reality this week, with the launch of a real-time payments platform in Australia.

The New Payments Platform’s (NPP) financial architecture has been designed and constructed to transform how consumers, businesses, and governments transact with one another.

SWIFT has supported the evolution of payments systems around the world for more than 40 years. It played a key role in the design, build and delivery of the NPP and will continue to operate its infrastructure. This is the first step in SWIFT’s global instant payments strategy and illustrates a blueprint for what we can expect to arrive in Europe.

Instant payments are set to launch across Europe in 2018, alongside the launch of TARGET Instant Payment Settlement (TIPS), the euro real-time payments service commissioned by the Eurosystem. SWIFT’s new messaging service will harmonize the infrastructure throughout the continent and allow instant payments to be made in euros through both TIPS and EBA CLEARING’s RT-1 instant payments system.

Consumers, businesses and the broader economy are only beginning to see the possibilities with new services such as same-day delivery, just-in-time manufacturing, and instant payment apps. SWIFT currently connects 85 of the 149 High-Value Payments systems in the world, including CHAPS in the UK, TARGET2 in Europe and the SWIFT India Domestic Services. It also offers gateways to instant payments platforms in Hong Kong and in the US. All of this suggests the payments industry has only taken small steps towards reaching its full potential.

It is likely that real-time line-by-line settlement, open access infrastructure that empowers innovation via competition, and overlay services that provide value-added services are likely to become the norm.

This is a once in a generation opportunity to reinvent the payment process. While Europe awaits the arrival of instant payments in November 2018, it will be interesting to observe the changes in Australia that occur due to this new payment landscape.