Barclays Pays $50M To Settle NY Forex Markets Rigging Claims – Law360

Barclays PLC has agreed to pay $50 million to settle claims that it misused a system intended to block unprofitable foreign exchange trades as a way to boost the bank’s profits while hurting clients, according to court documents filed Wednesday in New York federal court.

Pound Volatility is Highest Since Debt Crisis as EU Talks Begin – Bloomberg

Pound traders’ expectations for price swings against the euro in the next six months are at the highest level since the currency bloc’s debt crisis in 2011, as U.K. Prime Minister David Cameron seeks a deal on the terms of Britain’s membership of the European Union.

Global Markets Are Falling Out of Lockstep, and That’s a Good Thing – Bloomberg

Slowly, as global markets show signs of waking from their New Year’s rout, the lockstep moves that have paralyzed investors from Tokyo to New York are beginning to ease.

US Farmers Hit by Fallout from Dollar’s Strength – Financial Times (subscription)

Rising global inventories thanks to plentiful harvests, the high value of the dollar as well as falling oil prices have meant lower prices for agricultural commodities, weighing on farm incomes.

Brazil Real Underperforms Latam Currencies on S&P Downgrade – Reuters

The Brazilian real underperformed on Thursday after the country received a rating downgrade, while Latin American markets broadly inched higher due to hopes for a stabilization in oil prices. Citing considerable economic and political challenges, Standard & Poor’s downgraded Brazil deeper into junk territory. The currency closed down 1.4 percent at 4.046 to the dollar.

Hong Kong Yuan Interbank Rates Surge as Currency Loses Ground – Bloomberg

Yuan borrowing costs in Hong Kong climbed to one-month highs, a sign of renewed appetite for bets against the currency.

Excessive Loosening of China’s Monetary Policy Would Increase Yuan Pressure: Central Bank – Reuters

Excessive loosening of monetary policies in China would create asset bubbles and increase downward pressure on the yuan, the vice governor of China’s central bank warned

NY Fed Warns Asset Managers are Vulnerable to ‘Runs’ – Financial Times (subscription)

The New York Federal Reserve has warned that asset managers are vulnerable to quasi-bank runs that can cause “significant negative spillovers” across financial markets.

Regulatory News

Georgia Man Pleads Guilty in Global Hacking Scheme Involving Stolen News Releases – Wall Street Journal

Group of hackers and traders accessed deal news to make trades before the information came out, authorities say. 

CFTC Staff Extends Request for Comment Period on Draft Technical Specifications for Certain Swap Data Elements

The U.S. Commodity Futures Trading Commission’s (CFTC) Division of Market Oversight and Office of Data and Technology staff today extended the request for comment period on the draft technical specifications for certain prioritized swap data elements and associated questions.

Company News

Big banks See the Need to Shrink – But Face a Path Full of Obstacles – Reuters

When the U.S. Federal Reserve’s newest policymaker Neel Kashkari dropped a bombshell with a call to break up big banks on Tuesday, it was met with a predictably indignant response from their lobbyists.

PBOC Will Raise Reserve Ratios for Banks Who Don’t Meet Criteria – Bloomberg

China’s central bank said some banks will be forced to lock away more reserves, a move that may contain credit growth after advances by smaller lenders jumped in January.

Market Savvy

Campbell Report Sees Benefits in Multi Asset Class Carry – Profit & Loss

Although the carry trade is most widely associated with the foreign exchange market, a new report by Campbell & Company offers research into the “powerful portfolio effect” and “superior long term, risk-adjusted returns” that can be gained from a multi-asset class approach to carry.

Swedish Central Bank Has Reached Bottom on Rates, Survey Shows – Bloomberg

The bank will keep rates below zero until at least the first quarter 2018, according to a majority of respondents in a Bloomberg survey of 41 economists.

Negative Interest Rates Set Stage for Next Crisis, Stephen Roach Says – MarketWatch

In what could well be a final act of desperation, central banks are abdicating effective control of the economies they have been entrusted to manage. First came zero interest rates, then quantitative easing, and now negative interest rates — one futile attempt begetting another.

China Bears Say the Capital Outflow Is Just Beginning – Bloomberg

Yuan bears say this month’s rally shouldn’t be taken as a sign China’s great reversal in capital flows has finished. Goldman Sachs Group Inc. warns that any further shock depreciation will only accelerate the exit.

Press Releases

NFA’s Board of Directors elects Michael Dawley to serve as Chairman

The Board of Directors of National Futures Association (NFA) has elected Michael C. Dawley, Managing Director, Goldman Sachs & Co., to serve a one-year term as Chairman.

SGX Consults on Changes to Derivatives Rules and Contract Specifications

Singapore Exchange (SGX) is seeking public feedback on proposed amendments to the Futures Trading Rule, SGX-Derivatives Clearing (SGX-DC) Rules and various contract specifications.