Wararka

China state banks plan curbs on metals, forex trades if U.S. election fuels volatility…

FILE PHOTO: A security guard wearing a mask following the coronavirus disease (COVID-19) outbreak is seen near the Bank of China in Beijing, China, October 19, 2020. REUTERS/Tingshu Wang

Reuters . Mon, November 2, 2020, 11:34 AM GMT+1
BEIJING/SHANGHAI (Reuters) – Two major state-owned Chinese banks warned on Monday that they could restrict trading of precious metals and foreign exchange products if this week’s U.S. presidential election fuels market volatility.

Bank of China <601988.SS> <3988.HK>, the fourth largest lender by assets, said it might curb or suspend such trade, while Bank of Communications <601328.SS> said it was taking steps to potentially limit spreads and transactions during the election.

“We expect volatility in the precious metals and foreign exchange market to increase significantly between Nov. 3 and Nov. 4,” Bank of China said in an online statement.

“Market liquidity will be notably lowered, and market risks may intensify.”

The bank said it might suspend trading of affected products “under the extreme scenario of a liquidity crunch”, and cap trading volumes during the election.

Bank of Communications said it would make “flexible adjustments” and restrict transactions based on international market quotations and market liquidity.

Both lenders said curbs would be lifted once the market stabilised, however.

Traders and investors are closely watching the outcome of the election, with Republican President Donald Trump trailing Democratic challenger Joe Biden in national opinion polls.

(Reporting by Cheng Leng in Beijing and Andrew Galbraith in Shanghai)

About Admin (12233 Articles)
Wararka Somalia iyo kuwa caalamka ayaan idinka haqab tireynaa.
%d bloggers like this: