After announcing a pilot phased launch of its long-awaited electronic foreign exchange trading platform (FXTP), the Bank of Jamaica (BOJ) said that the first week of operations got off to a good start.

“The activities in the first week were largely administrative with eight of the 10 deposit-taking institutions (DTIs) eligible to trade on the platform completing the enrollment of their users. By the end of the week, three of these entities commenced posting orders in the system,” Deputy governor with responsibility for banking and currency and the financial markets infrastructure, Natalie Haynes said in responding to questions posed by the Business Observer on Monday.

The pilot, which commenced on June 1, allowed DTIs to trade, while cambios get the chance to familiarise themselves with the system as observers. Though unable to participate in the activities, the cambios will be able to observe daily trades in real-time. This will help them to make informed decisions when they are ready to approach the market to buy or sell foreign exchange.

The deputy governor also indicated that the majority of the observers have successfully satisfied the enrolment requirements. “These cambios will retain an observer status pending further system refinements to reflect protocols governing who a DTI may trade with. Currently, seven BOJ foreign exchange intervention and trading tool (B-FXITT) cambios have satisfied all the requirements for enrolment in the system. At the same time, the remaining entities will be enrolled this week,” she told the Business Observer, noting that some large corporate clients who buy and sell FX have also started to come on board.

“Four entities the Jamaica Public Service (JPS), two entities from Jamaica Manufacturers and Exporters Association (JMEA) and one entity from the Jamaica Hotel and Tourist Association (JHTA) have finalised the requirements for enrolment to the system and will receive their access credentials this week. This process of enrolling corporates will be ongoing subject to the receipt of their enrolment documents,” Haynes also outlined.

Reporting on the feedback from users after the first week, she said that based on the responses coming out of the training and testing phase, “the entities generally welcome this electronic platform that allows for real-time FX trading, improved transparency of the activity between authorised FX traders, and improved efficiencies emanating from automated processes.”

The FXTP system, the BOJ has said will be introduced gradually through three phases [order market trading, quote market trading, and external market reporting]. It will effectively replace the central bank’s long-standing eGate system— which is currently being used for reporting all daily transactions in the FX market. The first and second phases are expected to commence by the end of this year, while the third phase will begin by the end of the first quarter of next year.