Top Headlines
Brazil Watchdog Fines Morgan Stanley, Royal Bank of Canada for Forex Manipulation – Reuters
Brazil’s antitrust watchdog fined Morgan Stanley and Royal Bank of Canada a total of 42.9 million reais ($11.6 million) for meddling with foreign exchange rates charged to clients.
Euro Climbs Ahead of ECB Meeting, Fed-Driven Dollar Rally Unwinds – Reuters
The euro edged back above $1.18 as speculation grows the European Central Bank will signal an end date for its vast stimulus programme at its policy meeting on Thursday and after the dollar erased all its gains from a slightly more hawkish Federal Reserve.
Dollar’s Momentum Fades Into ECB Policy Meeting – Financial Times (subscription)
As attention turns towards the European Central Bank and away from the Federal Reserve, the dollar’s rally is fading, with investors on the look out for a signal on the timing of the end of stimulus spending in the eurozone.
Sterling Hits Five-Day High After UK Retail Sales Smash Forecasts – Reuters
Sterling rose to a five-day high after British retail sales jumped for a second month in a row in May and far outstripped expectations.
FCA Paper Claims to Throw New Light on Sterling Flash Crash – Profit & Loss
A new paper published by the UK’s Financial Conduct Authority (FCA) claims to throw new light on events surrounding the sterling flash crash of October 2016 by being the first paper to use trade reports to the FCA under EMIR to analyse how different market participants react in times of market stress and their impact on the liquidity dry-up in a flash crash.
Bankers to Ask Theresa May Why They Should Stay After Brexit – Reuters
The bosses of some of Europe’s biggest banks will ask Britain’s Prime Minister Theresa May to give them a reason to stay in the City of London after Brexit now that hopes are fading for a generous EU trade deal.
Easy Transatlantic Pickings Come to End for US Banks – Financial Times (subscription)
The era of US investment banks winning market share from ailing European rivals is at an end, the investment bank bosses of two of Wall Street’s biggest groups told the Financial Times.
CTAs Down in May, Despite Currency Gains – Profit & Loss
The flash estimate for the Barclay CTA Index, compiled by BarclayHedge, indicates a 0.24% loss in May, although currency traders gained 0.88% last month. Year-to-date, the Barclay CTA Index is down 1.76%.
Ambiguous, Confused and Conflicted – Profit & Loss (subscription)
The prosecution’s argument against bail for Mark Johnson case yet again demonstrates a fundamental lack of understanding as to how the FX market handles large risk.
A Data-Science Approach to Building Sustainable Trading Relationships – Profit & Loss (subscription)
There is a changing dynamic afoot when it comes to relationships between service providers and clients in the foreign exchange industry.
Regulatory News
The Message of the June Fed Meeting: There’s a New Chairman in Charge – The New York Times
Jerome Powell’s policy decision was in line with his predecessors, but he made a series of changes that give him more flexibility in the years ahead.
ECB Looks at Deutsche Bank, BNP, SocGen’s Trading Books – Bloomberg
The European Central Bank is taking its closest look yet at the trading books of three of the euro zone’s biggest lenders, according to people briefed on the matter.
Questions Remain on Scope of Mifid Extraterritoriality – Risk (subscription)
Global firms confused about reach of trading obligation and best execution rules.
Crypto News
US Agency’s Virtual Currency Oversight Faces Court Challenge – Reuters
An obscure virtual currency called My Big Coin is now at the centre of a closely watched case that could determine whether the US Commodity Futures Trading Commission has the authority to combat fraud associated with cryptocurrencies.
Financial Crime Task Force Eyeing Binding Crypto Exchange Rules: Japan Official – Reuters
International financial crime-fighting group Financial Action Task Force (FATF) will start discussions later this month on introducing binding rules governing cryptocurrency exchanges, a Japanese government official familiar with the matter said.
- Cryptocurrency Does Not Threaten Financial Stability, Says German Government – Coin Telegraph
- Israel Regulators Punt on Crypto Exchange Rules – Markets Media
Thomson Reuters Expands Cryptocurrency Sentiment Data Tracking – Profit & Loss
Thomson Reuters announced the expansion of its sentiment data offerings to track the top 100 cryptocurrencies through its partnership with MarketPsych Data, a firm that focuses on quantitative behavioral science.
Banks Unlikely to Process Payments with Distributed Ledgers for Now, Says Ripple – Reuters
Banks are unlikely to use distributed ledgers to process cross-border payments for now because of scalability and privacy issues, according to Ripple, one of the most prominent startups developing the technology.
Bitcoin fell on Wednesday after an academic paper claimed the cryptocurrency’s run to $20,000 appeared to be driven by market manipulation.
Company News
Thomson Reuters and 360T Collaborate on FX Pricing – Profit & Loss
360T, Deutsche Börse Group’s FX unit, and Thomson Reuters have agreed to collaborate in order to enable pricing of Thomson Reuters FXall customers through 360T’s rate engine technology.
Deutsche Bank Team Follow FX Chief to Hedge Fund – Financial News (subscription)
Team up to seven-strong follow Sam Wisnia, who left the German bank in March, to join Eisler Capital.
Eurex: Clearing Competition Won’t Increase Costs – Markets Media
Eurex Clearing, the clearing house owned by Deutsche Börse, disputed that costs will increase if euro clearing is forced to move away from London after the UK leaves the European Union.
Market Savvy
Currencies See-Saw as Dollar Strengthens After Rate Rise – Financial Times (subscription)
Emerging markets currencies suffered a bout of whiplash in the wake of the Federal Reserve’s decision to raise interest rates and tighten policy at a quicker pace this year.
Hong Kong Raises Base Rate in Lockstep with Fed – Financial Times (subscription)
Hong Kong is compelled to raise rates to prevent a rise in outflows as its currency is pegged to the US dollar.
NAFTA la Vista, Baby – Financial Times (subscription)
Despite Mr Obrador’s seemingly imminent victory, currency traders are gearing up for the election to be a volatile period for the Mexican currency.