Hong Kong Unveils Trial of New Gold Clearing Platform

SEATTLE (Scrap Monster): Hong Kong has begun the trial operation of a new gold clearing system. This represents an important step forward in its strategy to become a leading global bullion trading center and strengthen its role in international precious metals markets.

Announcing the launch at the Hong Kong FIC & Bond Connect Summit, Chief Executive John Lee said the new platform introduces the HAU gold price benchmark, which has been made available on Bloomberg.

The government-backed Hong Kong Precious Metals Central Clearing Ltd. will provide a full range of over-the-counter (OTC) gold clearing services. According to Lee, the first gold deposits and settlement transactions have already been completed.

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The clearing company's board includes 11 major financial institutions, including JPMorgan Chase, HSBC, and UBS, apart from five leading Chinese banks. HSBC announced plans to quickly expand its gold storage capacity in Hong Kong to 200 tonnes. Also, Standard Chartered confirmed it had completed initial transactions with several corporate clients.

The launch will boost Hong Kong’s effort to become a regional bullion trading hub. It must be noted that Singapore recently announced plans to establish its own gold clearing platform later this year.

As per reports, Hong Kong is also working with the Shanghai Gold Exchange to improve cross-border gold settlement and liquidity.