Top Headlines 

Central Bankers Warn Again on Clearing House Contagion – Financial News (subscription)

The financial system is still at risk from a high degree of concentration among clearing houses, the financial plumbers at the centre of the world’s banking network, according to global regulators.

SNB Governor on Lifting the Currency Floor – FX Week (subscription)

Thomas Jordan, chairman of the Swiss National Bank, has overseen its commitment to the Swiss franc’s floor with the euro since becoming chairman in 2012 – including its sudden removal on January 15, 2015, which rattled the FX industry at the time. 

CFD Providers Prepare for Potential Client Shift to Unregulated Entities – Euromoney

Providers of FX contracts for differences will be monitoring their trading volumes closely over the coming weeks to see whether warnings of clients moving to unregulated providers come to pass.  

Regulatory News

ESMA Updates Validation Rules Under EMIR – ESMA

The European Securities and Markets Authority has updated its validation rules of the European Markets Infrastructure Regulation with regards to the revised technical standards on reporting under Article 9 of EMIR.

Offshore Eonia? A Weird Idea for Weird Times – (subscription)

There are few things more intrinsically European than Eonia. It is the benchmark overnight rate for overnight loans in euros; the 28 banks still contributing to it are European, and most are from eurozone countries. So the idea of an offshore Eonia swap market, constructed for the benefit entirely of non-European banks, initially sounds weird.

Margin ‘Big Bang’ to Catch Tenfold More UK Firms, FCA Estimates – (subscription)

The final phase of the initial margin requirements for non-cleared trades in 2020 will capture 5.9% of UK financial firms – an almost tenfold increase from 0.6% currently – analysis by the Financial Conduct Authority shows.

Brexit and the Buy Side – Markets Media

Commentary by IHS Markit: OTC derivatives market participants are receiving a growing number of requests from their dealers to novate swaps from one entity to another within the same dealer group. 

Crypto News 

Eurex’s Asia Head Says ‘Most Prop Trading Firms Are Already Trading Digital Currencies’ – The Trade

The regional head of Asia for one of the world’s largest futures exchanges has said most of its proprietary trading firm clients are already trading digital currencies, or are at least observing.

Futures Contracts in Crypto Are Too Early: LMAX Digital – Global Investor (subscription)

The lack of regulation shouldn’t be a show stopper for institutional clients given that spot FX isn’t regulated, an expert says.

Bitcoin’s Big Problems – Bloomberg (subscription)

Bitcoin was recently called a combination of a bubble, a Ponzi scheme and an environmental disaster by one of the world’s leading authorities.

Two of the Largest Crypto Exchanges Have Snagged Veteran Wall Streeters – Business Insider (subscription)

BitMEX and Coinbase, two of the largest marketplaces for crypto, have snagged veteran Wall Streeters as the firms vie for more business from large traditional financial services companies. 

Company News

Keogan Steps Down from Fidelity – Profit & Loss

Phelim Keogan, who over the past 15 years has led the development of Fidelity International’s currency management capabilities globally, has recently departed from the company.

OTCX Building for the Future – Securities Lending Times

OTCX has launched what it describes as the world’s first electronic non-deliverable interest rate swaps in a range of currencies: the Colombian peso, Malaysian ringgit, Chilean peso, Chinese yuan and Taiwan’s dollar.

Deutsche Bank Cuts Again. Not Even Fruit Bowls Are Safe – Bloomberg

The list of perks at Deutsche Bank is shrinking fast. Investment bankers at Germany’s largest lender have been told to travel coach class on trains; fewer are able to attend conferences and some former employees said severance pay was less generous than previous handouts.

Germany’s Merck Boosts Hedges Against Currency Gyrations – The Wall Street Journal (subscription)

Merck hedges between 30% and 70% of its expected currency exposure over the next 12 months, and the company is close to the upper end of that range now.

Market Savvy 

Turkish Crisis Rattles Currency Markets; Dollar Hits One-Year High – The Wall Street Journal (subscription)

The Turkish lira tumbled as much as 12% Friday against the US dollar, which rose to its strongest point in a year, as concerns about the health of Turkey’s financial system rippled through global markets.

Euro Whacked on Turkey Turmoil as Investors Scramble for Safety – Reuters

The euro sank to its lowest levels in more than a year on Friday after a report that the European Central Bank was growing concerned about the exposure of banks to a dramatic slide in the Turkish lira.

Pound Pummelled By Stronger Dollar, Mounting Brexit Fears – Reuters

Sterling slid to its lowest level since June 2017 on Friday as a stronger dollar and continued concerns that Britain could leave the European Union without a trade deal pushed investors to sell pounds.

China’s FX Reserves Unexpectedly Rose in July – FX Week (subscription)

China’s foreign exchange reserves unexpectedly rose in July for a second month running despite the country’s central bank not intervening in the FX market to defend the weakening yuan amid escalating trade tension.

Yuan Eases, Set to Extend Longest Losing Streak to Nine Weeks – Reuters

China’s yuan eased on Friday and was on track to extend its longest losing streak on record to nine straight weeks as the dollar climbed and investors worried about slowing growth at home and abroad as trade tensions deepen.