The London Metal Exchange today said it would change its electronic closing price system to make it more efficient while its iconic trading ring remains shut.
The bourse said the move was separate to plans to consult on closing the ring as part of moves to modernise its trading system.
Plans to improve the market’s electronic trading system were in place long before January’s proposals to shut Europe’s last open-outcry trading floor on a permanent basis.
A members’ notice said: “The key changes are designed to provide additional granularity in respect of certain aspects of, rather than to introduce material changes to, the existing methodology”.
Back in January, the bourse said that it was the “right time to consider the permanent closure of the Ring and a move to an electronic pricing structure”.
At the time, LME added that such a step would benefit the market by increasing the market and improving transparency.
With its distinctive red circular sofa, the ring has been a feature of the LME through two world wars, the Spanish flu, and numerous financial crises.
Since the 1800s, traders at the exchange have shouted buy and sell orders for metals while seated around the sofa.
But after being shut due to social distancing requirements brought about by the pandemic, steps have been taken to close the ring for good.
LME chief executive Matthew Chamberlain said: “The Ring is a greatly treasured aspect of the LME’s rich 144-year history, and its closure is not a decision we or our market will take lightly.
“However, the LME has stood the test of time precisely because of its ability to adapt to the evolution of market dynamics and trading behaviour.
“We have been clear that we will not use the pandemic as a pretext to close the Ring, and we remain committed to this; however, it is fair to observe that this period of electronic pricing has served the market well, with consistently high volumes of activity in the pricing window, easily observable by all stakeholders, and more participants with direct access.
“Given the data, and our industry’s continued move towards digitisation and greater transparency, we believe it is now time to consider the long-term future of pricing at the LME.”