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FXPA Responds to FEMR’s Final Report

The Foreign Exchange Professionals Association (FXPA) supports the Final Report published by the Fair and Effective Markets Review (FEMR) today, which sets out 21 recommendations to help restore trust in the wholesale Fixed Income, Currency and Commodity (FICC) markets.

“FEMR’s Final Report provides a framework to move the FX industry towards a series of generally accepted standards globally. FEMR has taken an important and thoughtful step forward, one that has clearly been made after considerable consultation with a wide selection of market participants,” says FXPA. “The FXPA was formed to allow for a dialogue across a diverse group of market participants. We hope to be a useful partner in formulating solutions that will restore trust in the FX market, and advance a sound, liquid, transparent and competitive global currency market.”

“FXPA believes regulation must be coordinated so as to minimize chances of regulatory arbitrage. The FEMR recommendations around FX provide a foundation for a global conversation among all market participants toward this goal,” FXPA continues.

The Review was established by the Chancellor of the Exchequer and Governor of the Bank of England to help to restore trust in those markets in the wake of a number of recent high profile abuses.

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Reasons to Fear a ‘Triple Taper Tantrum’

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Reasons to Fear a ‘Triple Taper Tantrum’ – Financial Times (subscription)
Why are we worried not just about a taper tantrum but a “triple taper tantrum”? Because central banks do not have a contingency plan for success. Even partial success – stabilisation of growth rather than an outright revival – could be enough to derail their best-laid plans for a smooth exit from excessive monetary accommodation.

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UK to Unveil Financial Market Reforms

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UK to Unveil Financial Market Reforms – Wall Street Journal (subscription)
The UK will unveil a suite of reforms Wednesday aimed at cleaning up British financial markets after a series of scandals. The yearlong Fair and Effective Markets Review – a joint effort between the Bank of England, the UK Treasury and Britain’s Financial Conduct Authority – will zero in on practices such as “front-running” and “last-look,” controversial strategies that can be used by traders in a way that can disadvantage their clients, according to participants in the consultation and the bodies’ initial review document.

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Bank Malpractice and FEMR on the Agenda for Mansion House Speech

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Bank Malpractice and FEMR on the Agenda for Mansion House Speech – Profit & Loss (free story)
Malpractice within the banking system and outcome of the Fair and Effective Markets Review (FEMR) are likely to be the key themes in the Mansion House speech delivered on Wednesday, according to one market source with knowledge of the matter.

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How Regulators Can Keep Bankers Honest

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How Regulators Can Keep Bankers Honest – Wall Street Journal (subscription)
Banks have shelled out more than $10 billion in fines for trying to rig the foreign-exchange markets, including fines of $5.6 billion handed down by US authorities last month in a deal that saw five banks plead guilty to criminal offenses. Yet so far, no individual has been charged with a crime, while the share prices of the banks even rose on the day the fines were announced. Results of a UK review are due next week and could lead to recommendations to more easily punish bank employees.

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