Gold Market
Exclusive | Hong Kong to launch long-awaited gold clearing and settlement system next week: sources
Hong Kong will launch a long-awaited gold clearing and settlement system next week, making a giant stride towards being an international price-setter for the key precious metal, according to two sources with knowledge of the matter.
The authorities plan to process the first gold settlement through the new system on Tuesday, one source told the South China Morning Post.
“We have seen a lot of gold leave London, the US and Europe, and large bars have been flown into Asia in anticipation of this,” the source said. “It could create some volatilities in the London gold market in the short term as the market sort of rebalances.”
Hong Kong could move from being a gold-price taker to a price maker if the city gains more subscriptions from global and local banks, according to the source.
Another source, who is an executive of one of the banks that will participate in the clearing system, told the SCMP that the bank was preparing to start making deals with gold traders next week.
Meanwhile, Hong Kong Exchanges and Clearing (HKEX) would also waive the fee for gold futures from Monday for a year as it relaunches the product, according to a circular of the HKEX sent to gold traders. This will mark the fourth attempt by the bourse operator to launch the product, following three previous failed attempts since the 1980s.
