Artificial intelligence incorporated in the system eliminated a lot of paperwork formerly needed.

A serial port from the terminal allows a back office feed and the maximum number of simultaneous conversations was increased to four from two. It also used colour screens and offered a faster network.

Prices displayed on the first phase terminals remained indicative only, with separate confirmation needed by telephone. This has been changed in the most advanced system currently in use, D2000-2, which displays firm prices.

Users of D2000-1 are being upgraded at no cost but some transaction costs apply to deals done on the newest system.

The foreign exchange market has benefited greatly from the advanced technology introduced by Reuters since 1981, according to Bruce Mitchell, manager, transaction products for Reuters Asia.

'There was initial resistance from money brokers. They were a bit hesitant about it because they thought it would take business away from them.

'However, it actually did them a lot of good because it increased liquidity in the market. Most of the money brokers now have D2000-1 which they use to send out information to clients themselves.' There are a few earlier Monitor Dealing systems still in use but these are being phased out, with completion scheduled for the middle of next year.

While the earlier dealing screens were green and black, D-2000 screens are colour. The artificial intelligence functions include smart prompts which cut down key strokes for time-conscious dealers.

'For example, you can load in a number of banks you call regularly so that, instead of having to type in a code, you just hit one button. They are then all called and automatically asked [their rates] for, say spot dollar mark instead of having to type it in.' The capture facility offered by the serial port also cuts down on the possibilities for human error.

Further improvements are planned.

These include an optional fixed format dealing system and a pre-screen price system which will allow dealers to know how much of a screened deal they can actually take part in, taking credit limits into account.

These limits are among the most sensitive of issues to banks operating in the foreign exchange and money markets.

They are the limits banks set in dealing with each other based on their risk assessments and banks prefer to keep them to themselves.

The D2000-2 system incorporates each bank's limits but keeps them confidential.

'They are a touchy subject because things change. For example, a while ago, people had to cut back their credit to some of the biggest banks in the world, especially US banks, because of worries over Third World loans and other issues.

'When we were talking about launching D2000-2, the most common question asked by the banks was: 'How do we handle credit?' They needed their limits held in the system in a secure manner. It was important for the banks not to let that information out.' Competitors have tried to take on Reuters in foreign exchange dealing but they have not made significant inroads.

One of Reuters' advantages is its free format which allows dealers to exchange general, as well as dealing, information.

Mr Mitchell explained: 'Dealers don't just ring each other up and say, 'Let's do a deal'. They chat to each other because they all know each other and build up rapport. They pass on information and ask about economic factors while they discuss prices.

'One competitor designed a system with a fixed format which didn't allow you to have those conversations - it was designed mainly for the big banks around the world just to do a deal, and the market rejected it. The market just said: 'Sorry, we don't like this fixed format, we like to be able to talk to each other'.'