Riding on the success of its four-month-old gold futures market, Dubai this week launched similar contracts for silver, to be followed by foreign exchange, steel, agricultural and energy products. 'This is a big leap forward for our young exchange,' said David Rutledge, director of the Dubai Gold and Commodities Exchange and chief executive of the Dubai Multi-Commodities Exchange. Mr Rutledge announced on Monday at the World Exchange Congress in Dubai that the gold exchange had just received approval to trade forex futures - the first exchange to do so in the Middle East. The contracts will initially cover contracts for the euro, sterling and yen against the dollar, he added. Gold exchange vice-chairman Jignesh Shah said: 'With the increased trading volumes and healthy liquidity witnessed in the gold futures contracts, it is an appropriate time to offer one more product to the market.' On the first day of silver futures trading, 1,158 contracts equal to 34,740kg were traded, for a market turnover of about US$12.7 million. In the gold futures market, volumes in March touched a daily average of 31,989kg valued at US$568 million - up more than 400 per cent from January's 6,478kg level. Trading volume has averaged about 1,750 contracts a day, with a high of 3,082 recorded on March 6. Ajay Mathur, commercial relations manager at HSBC Middle East, welcomed the introduction of the silver contract. 'This is in line with what [the gold exchange] had envisaged. This is based on a survey which indicated traders wanted silver futures contracts. The exchange is servicing the traders' requirements,' said Mr Mathur, who is in charge of the gold and diamond portfolio. Gold exchange chief executive Framroze Pochara said introducing a diversified basket of commodities for trading would 'benefit market participants for hedging, arbitrage or investment purposes'. Analysts said corporate treasuries, importers and exporters, professional and interbank traders, and retail players from the region are expected to benefit from the new foreign exchange futures.
