Terminology related to inter-bank foreign exchange market

Inter-bank foreign exchange market: a market where domestic financial institutions (including Chinese and foreign banks and non-bank financial institutions) approved by the People's Bank of China and the State Administration of Foreign Exchange can conduct RMB and foreign exchange transactions through the inter-bank foreign exchange trading system of China Foreign Exchange Trading Center (hereinafter referred to as the "Trading Center").

Foreign exchange: Foreign exchange has both dynamic and static meanings.

The dynamic meaning of foreign exchange refers to the international exchange behavior and process of converting one country's currency into another country's currency, that is, a special commercial activity to pay off international creditor's rights and debts.

The static meaning of foreign exchange refers to the financial assets expressed in foreign currency that can be used for external payment. Article 3 of the Regulations on Foreign Exchange Control in People's Republic of China (PRC) stipulates: "Foreign exchange as mentioned in these Regulations refers to the following means of payment and assets that can be used for international settlement in foreign currencies: a foreign currency, including banknotes and coins; Foreign currency payment vouchers, including bills, bank deposit vouchers and postal savings vouchers. ; Foreign currency securities, including government bonds, corporate bonds, stocks, etc. ; 4. Special drawing rights; 5. Other foreign exchange assets. "

Exchange rate: it is the conversion rate between currencies of different countries, that is, the price expressed by one currency unit in another currency unit.

Benchmark exchange rate: The People's Bank of China announces the market transaction median price of RMB against USD, JPY and HKD in the inter-bank foreign exchange market every day, which is the benchmark exchange rate of RMB against USD, JPY and HKD among designated foreign exchange banks and between designated foreign exchange banks and their customers.

Bank foreign exchange quotation: The designated foreign exchange banks independently calculate the central parity of RMB against various freely convertible currencies other than USD, JPY and HKD based on the benchmark exchange rate of RMB against USD published by the People's Bank of China and the international foreign exchange market. Designated foreign exchange banks can set the buying and selling prices of listed currencies in foreign exchange and cash within the floating range of the exchange rate stipulated by the People's Bank of China. These listed prices are the bank's foreign exchange rate.

Direct quotation: calculate how much foreign currency should be paid according to a unit's foreign currency.

Indirect pricing method: based on the local currency of a unit, calculate how much foreign currency is receivable.

Foreign exchange market: the market for buying, selling and exchanging currencies is a place for buying and selling foreign exchange, which consists of foreign exchange demanders, foreign exchange suppliers and buying and selling intermediaries.

Exchange rate system: refers to a series of arrangements or regulations made by a country's monetary authorities on the basic way of exchange rate changes in that country. Such as stipulate that external value of the domestic currency, the fluctuation range of the exchange rate, the exchange rate relationship between the domestic currency and other currencies, and the way to influence and intervene the exchange rate change. Traditionally, exchange rate system is divided into fixed exchange rate system and floating exchange rate system; After 1973, the exchange rate system has become increasingly diversified, and the International Monetary Fund has reclassified the exchange rate system into two types: the pegged exchange rate system and the flexible exchange rate system, the latter including the floating exchange rate system.

Settlement and sale of foreign exchange: the bank settlement and sale of foreign exchange system began with the reform of 1994 foreign exchange management system. From 1994 65438+ 10/0/,the state abolished various foreign exchange retention, repatriation and quota management systems, and implemented the system of bank settlement and sale of foreign exchange under current account of domestic institutions. Under the system of bank settlement and sale of foreign exchange, settlement of foreign exchange refers to the behavior that the owner of foreign exchange income sells foreign exchange to the designated foreign exchange bank, and the designated foreign exchange bank pays the equivalent RMB according to the RMB exchange rate on the transaction day; The sale of foreign exchange refers to the behavior of designated foreign exchange banks selling foreign exchange to foreign exchange users and collecting the equivalent RMB at the RMB exchange rate on the transaction date.

Forward foreign exchange settlement and sale business: refers to the forward foreign exchange settlement and sale contract signed by designated foreign exchange banks and domestic institutions, which stipulates the foreign exchange currency, amount, exchange rate and term of future foreign exchange settlement and sale; When due foreign exchange income or expenditure occurs, foreign exchange shall be settled or sold in accordance with the currency, amount and exchange rate agreed in the forward foreign exchange settlement and sale contract.

Comprehensive position of foreign exchange settlement and sale: refers to the foreign exchange position held by designated foreign exchange banks (hereinafter referred to as banks) due to RMB and foreign currency transactions, which is formed by banks' handling of foreign exchange settlement and sale to customers, their own foreign exchange settlement and sale business and participation in inter-bank foreign exchange market transactions.

Proprietary business (proprietary trading): According to the Provisional Rules for Market Trading of China Foreign Exchange Trading Center 1956438 issued by China Foreign Exchange Trading Center on October 4th, proprietary business refers to foreign exchange transactions conducted by members for the normal development of their own foreign exchange business.

Agency business (trading agent): According to the Provisional Rules for Market Trading of China Foreign Exchange Trading Center issued by China Foreign Exchange Trading Center 1995 on October 4th, agency business refers to foreign exchange transactions that members engage in to provide brokerage services for enterprises.

Spot foreign exchange transaction: Spot foreign exchange transaction is a foreign exchange transaction in which two different currencies are exchanged at the exchange rate agreed by both parties and settled after one or two business days.

Forward foreign exchange transaction: refers to a foreign exchange transaction in which the buyer and the seller sign a forward foreign exchange sales contract in advance, stipulating the currency, amount, exchange rate and future delivery time of the sale, and the buyer and the seller make payment and delivery at the agreed exchange rate on the agreed maturity date.

Foreign currency trading business: refers to the arrangement to facilitate the foreign currency trading and clearing of domestic financial institutions through the electronic trading and clearing platform in the inter-bank foreign exchange market. The foreign currency trading system launched this time is a system that provides trading and clearing for foreign currency-to-foreign currency spot trading, and does not involve RMB-to-foreign currency.

Financial derivatives: International Swaps and Derivatives Association (ISDA): "Derivatives are bilateral contracts for traders to exchange cash flows and transfer risks. When the contract expires, the amount owed by the trader to the other party is determined by the price of the basic commodity, securities or index. "

A derivative product is a financial contract whose value depends on one or more basic assets or indexes. The basic types of contracts include forward, futures, swaps and options. Derivatives also include structured financial products with one or more characteristics of forward, futures, swaps and options.

Inquiry transaction: Inquiry transaction refers to the transaction mode in which foreign exchange trading entities with mutual credit directly inquire and negotiate the currency, amount, exchange rate and future delivery time of the currency to be traded, and confirm the transaction after reaching an agreement.

Bidding transaction: the trading system sorts the buying quotation and selling quotation respectively, and makes matching transactions according to the principles of price priority and time priority.

Market maker in the inter-bank foreign exchange market: a member of the inter-bank foreign exchange market who, with the approval of the State Administration of Foreign Exchange, undertakes the obligation to continuously provide the buying and selling prices to market members when conducting RMB and foreign currency transactions in the China inter-bank foreign exchange market.

Financial institutions: refer to all kinds of Chinese-funded financial institutions and foreign-funded financial institutions (except insurance companies) established in China according to law.

Non-bank financial institutions refer to Chinese-funded trust and investment companies, financial leasing companies, finance companies, securities companies, insurance companies and other financial companies established with the approval of the People's Bank of China and registered in People's Republic of China (PRC).

Foreign-funded financial institutions refer to the following financial institutions established and operated in China with approval in accordance with relevant laws and regulations of People's Republic of China (PRC): foreign-funded banks headquartered in China; Branches of foreign banks in China; Banks jointly operated by foreign financial institutions and financial institutions in China in China; A foreign-funded financial company headquartered in China; Financial companies jointly operated by foreign financial institutions and financial institutions in China in China.

Overseas branches of Chinese-funded financial institutions: refers to the branches of Chinese-funded financial institutions that are not independent legal persons established overseas according to local laws.

Members of the inter-bank spot foreign exchange market: banks, non-bank financial institutions or non-financial enterprises that meet the relevant conditions and submit a written application to the trading center and are approved to engage in spot trading within the trading system provided by the trading center.

Balance of payments: refers to various economic transactions between an economy (usually a country or region) and other economies in the world in a certain period of time. Among them, economic transactions are transactions between residents and non-residents As a flow, economic transactions reflect the creation, transfer, exchange, transfer or reduction of economic value, including current account transactions, capital and financial account transactions and changes in international reserve assets.

Current account: refers to the flow of physical resources, including import and export goods, import and export services, foreign income receivable and payable, and regular transfer of economic value with other countries or regions without reciprocal returns.

Capital and financial projects: refer to capital transfer under capital projects, non-production/non-financial assets transactions and all other financial projects that lead to changes in the external assets and liabilities of the economy. Capital transfer refers to the transfer projects involving the change of ownership of fixed assets and the relief of creditor's rights and debts, which leads to the change of asset stock of one or both parties to the transaction, mainly including the transfer of fixed assets, debt relief, immigration transfer and investment donation. The transaction of unproductive/non-financial assets refers to the purchase and abandonment of unproductive tangible assets (land and underground assets) and intangible assets (patents, copyrights, trademarks, distribution rights, etc.). ). Financial projects include direct investment, securities investment and other investment projects.

Inter-bank foreign exchange trading system: refers to the electronic system provided by trading centers (including Shanghai headquarters of China Foreign Exchange Trading Center and Beijing Backup Center) for foreign exchange transactions among members and capital settlement.

Foreign exchange transaction: refers to the spot sale between RMB and foreign exchange.

Member: refers to domestic financial institutions approved by the trading center to engage in foreign exchange trading within the trading system.

Spot foreign exchange transaction: Spot foreign exchange transaction is a foreign exchange transaction in which two different currencies are exchanged at the exchange rate agreed by both parties and settled after one or two business days.

Forward foreign exchange transaction: refers to a foreign exchange transaction in which the buyer and the seller sign a forward foreign exchange sales contract in advance, stipulating the currency, amount, exchange rate and future delivery time of the sale, and the buyer and the seller make payment and delivery at the agreed exchange rate on the agreed maturity date.

Inquiry transaction: Inquiry transaction refers to the transaction mode in which foreign exchange trading entities with mutual credit directly inquire and negotiate the currency, amount, exchange rate and future delivery time of the currency to be traded, and confirm the transaction after reaching an agreement.

Centralized bidding: Centralized bidding for foreign exchange transactions refers to the way that multiple trading entities in the market conduct foreign exchange transactions through a trading system or platform at the same time according to certain bidding rules. For example, at present, the trading mode of China's inter-bank foreign exchange market is based on the bidding rules of time priority and price priority.

Centralized credit granting: the organizer of the foreign exchange market, as one party, grants a certain trading quota to all the trading entities involved in the transaction according to the amount of trading funds owned by each trading entity, and each trading entity also grants a certain trading quota to the Central Clearing Department.

Bilateral credit granting: the act of two parties directly granting each other a certain trading credit line in the foreign exchange market.

Bilateral clearing: After the foreign exchange transaction is concluded by the trading entities in the market, the funds will be directly remitted to the designated account of the other party without going through the clearing institution.