On 10 September 2003, the Singapore
Dollar (SGD) was included as one of the 11 currencies in the
Continuous Linked Settlement (CLS) system. The other 10 currencies
are the Australian Dollar, Canadian Dollar, Danish Krone, Euro,
Japanese Yen, Norwegian Krone, Pound Sterling, Swedish Krona,
Swiss Franc and the US Dollar.
CLS is the world’s first simultaneous global multi-currency
settlement system which eliminates FX settlement risk. The inclusion
of the SGD represents a significant milestone for Singapore
to create a safer FX settlement environment. As of April 2004,
the CLS Bank settled about 649 SGD FX trades a day worth more
than S$11.1 billion. Since CLS only requires funding on a net
basis, actual average daily payment (pay-in) is reduced by about
87.4% to S$1.4 billion, resulting in improved liquidity efficiency
and lower funding requirements for CLS users. A link from the
MAS Electronic
Payment System (MEPS) to the CLS system was also completed to
include SGD as a CLS settlement currency. |
