Top Headlines

CFTC Forces FXCM to Exit US Market, Issues $7m Fine – Profit & Loss

The US Commodity Futures Trading Commission (CFTC) has fined FXCM and its founding partners $7 million and ordered the firm to withdraw from doing business in the US for defrauding retail FX customers.

Euro Set for Biggest Daily Fall of 2017 Vs Dollar – Reuters

Beset by political worries, the euro was set for its biggest daily fall of 2017 against a broadly stronger US dollar.

Frexit Would ‘Impoverish’ France Warns ECB’s Cœuré – Financial Times (subscription)

Marine Le Pen’s plans to take France out of the euro would consign the country to impoverishment, one of the European Central Bank’s most senior French officials has warned.

Dollar Surges as March Fed Rate Hike Comes Into View – Financial Times (subscription)

The US dollar has reversed four consecutive days of declines with a vengeance after one of the country’s central bank officials raised the prospect of the first rate hike under the presidency of Donald Trump as early as next month. 

China Forex Reserves Drop Below $3tn for First Time Since 2011 – Financial Times (subscription)

China’s foreign exchange reserves fell below $3tn for the first time in nearly six years last month as its central bank spent more of its war chest on propping up the value of the renminbi and Beijing imposed new capital controls in an effort to slow the pace of outflows.

Yen Passes 112 for First Time Since November – Financial Times (subscription)

The yen strengthened to its highest level against the dollar in more than two months, despite a wider rally for the greenback.

Russia Will Buy Forex Carefully to Avoid Volatility – Reuters

Russia’s central bank’s foreign currency purchases aimed to replenish the country’s Reserve Fund will be done carefully to avoid market volatility, Finance Minister Anton Siluanov told reporters.

Malaysia’s Ringgit Crackdown Spooks Overseas Investors – Bloomberg

The central bank’s steps to curb trading in offshore non-deliverable forwards last year made it harder for global funds to hedge their exposure to Malaysia, according to Macquarie Bank.

Regulatory News

Donald Trump’s Executive Order to Roll Back Dodd-Frank is Basically Futile, Says Barney Frank – Independent

‘The executive order that the President offered with a lot of hype has no specifics. In fact, it doesn’t do anything’.

ECB Sees Seeds of Next Crisis in Trump Deregulation Plan – Reuters

The European Central Bank rejected US accusations of currency manipulation and warned that deregulating the banking industry, now being openly discussed in Washington, could sow the seeds of the next financial crisis.

Republicans Get Ready to Roll Back Dodd-Frank Law – Wall Street Journal (subscription)

Legislative challenge will primarily play out in Senate, where GOP holds 52 seats, but passage of overhaul likely would require 60 votes.

After Front-Row Seat to Crisis, Wall Street Adviser Heads to SEC – Financial Times (subscription)

Jay Clayton expected to ease rules rather than hand out record fines atop regulator.

Forex Swap Margin Treatment Uncertain Ahead of VM Deadline – Risk (subscription)

With one month to go, market participants are still unsure how to treat foreign exchange derivatives.

Company News

LSE, Deutsche Börse Offer Sale of French Clearing Arm as Antitrust Remedy – Financial Times (subscription)

Deutsche Börse and the London Stock Exchange Group have submitted the sale of the LSE’s French clearing arm as their sole remedy to European antitrust authorities to clinch approval from Brussels for their planned €29bn merger.

CME Group to Broaden Rules Against Wrongdoing After CFTC Request – Reuters

Futures market operator CME Group plans to broaden its rules against wrongdoing at the request of federal regulators, the company said, a move that is expected to ramp up disciplinary action against traders.

Thomson Reuters Buys DTCC’s Clarient and Avox Reference Data Arms – Waters Technology (subscription)

The vendors expect to conclude the deals before the end of the first quarter, officials say.

Currency Headwinds Cost Companies $11bn – FX Week (subscription)

North American firms report more losses than their European counterparts, but the amount is falling.

Market Savvy

C$ Weaker as Oil Slips; Trade, Jobs Data Eyed – Reuters

The Canadian dollar weakened against its US counterpart as oil prices fell and bond yields settled at a two-week low, with investors awaiting December trade data due on Tuesday and jobs numbers later in the week for signs of economic growth.

Australian Dollar Suffers Profit-Taking, GBP/AUD Exchange Rate Strengthens on Dire Forecast for RBA Policy – Exchange Rates

After surging last week, investors sold the Australian dollar from its highs in profit taking.

Turkish Lira Hits Four-Week High Against US Dollar – Anadolu Agency

The Turkish lira advanced to a four-week high against the US dollar.