New Brazilian Exchange Slated to Open Friday With Futures Contracts on Gold
RIO DE JANEIRO, Brazil -- A new Brazilian futures exchange, the latest of several recent attempts to start or expand futures markets outside the U.S., is scheduled to open Friday.</br></br>The planned exchange here, called the Bolsa Brasileira de Futuros, or the Brazilian Futures Market, will offer 250-gram futures contracts on gold for delivery over one to six months. It will be Brazil's second gold-futures exchange; the first was opened nearly four years ago in Brasilia. Officials of the new Rio exchange hope traders will use gold futures to hedge against Brazil's soaring inflation, which has run recently at rates exceeding 200% a year.</br></br>The proposed Rio exchange is among several planned, new or expanded futures-trading ventures in Singapore, Toronto, Hong Kong, Sydney and other cities outside the U.S. The growing volatility of financial markets has led many cities to try, with mixed results, to adapt U.S. futures-trading techniques to their own countries' economies. In some cases, they're forming linkages, such as the Singapore International Monetary Exchange's liaison with the Chicago Mercantile Exchange and the Sydney Futures Exchange's planned link with the Commodity Exchange in New York.</br></br>The Brazilian Futures Market is modeling itself after the Chicago Merc and has hired a former Merc vice president, Joseph Sims, as a marketing and public-relations executive. The Rio exchange's plans include offering interest-rate futures, as well as stock-index futures based on an index of stocks traded on Bolsa de Valores do Rio de Janeiro, the city's stock exchange.</br></br>The new exchange has 493 members, including Citibank and other banks, brokerage houses and exporters. All bought seats for six million cruzeiros, or more than $2,100. The exchange's gold futures, priced in thousands of cruzeiros, will be traded in five-hour sessions that begin at 11:30 a.m., or 9:30 a.m. EST.