Top Headlines
CFTC Head Plans Swaps Rules Rethink – Financial Times (subscription)
The top US derivatives market regulator has revealed plans to soften some of its rules for regulating swaps, saying the Obama-era standards had sometimes over-reached their jurisdiction and were increasingly out of step with the rest of the world.
- Top US Regulator Calls for ‘Reset’ in Relations with Other Countries – Reuters
- US Swaps Cop Apologizes for International Rules Overreach – Bloomberg
- Remarks of Chairman J. Christopher Giancarlo to the City Guildhall, London – CFTC
Wall Street Analysts Split on How to Trade ‘Overvalued’ Dollar – Bloomberg
By many conventional measures, the dollar is increasingly overvalued. Yet what investors should do with that information is becoming less clear.
Volumes Mixed in Early Reports – Profit & Loss
The first group of trading venues to report FX ADV for August indicate a mixed picture, although overall activity seems to be higher.
Merkel Offers Tacit Support for Frankfurt’s Clearing Bid – Financial Times (subscription)
Angela Merkel has given her tacit support to Frankfurt’s bid to replace London as Europe’s main clearing house for euro-denominated derivatives after Brexit, but hinted she was unlikely to intervene personally on the issue.
Regulatory News
Bank of England Gov. Mark Carney signaled Tuesday that he is willing to stay on as head of the UK central bank beyond his planned departure date next year, offering a measure of stability in British policy-making as the country prepares to leave the European Union.
UK Finance Industry Dominates European Scene – Financial Times (subscription)
Even if the UK loses a quarter of its international financial sector as a result of Brexit, it will still be double the size of any other European business centre, according to new research.
The Government’s New Strategy to Crack Down on ‘Spoofing’ – The New York Times
A recent setback raised questions about whether prosecutors can pursue “spoofing” cases. So late in July, the Justice Department took a new tack.
US Regulators Extend Comment Period for Proposed ‘Volcker Rule’ Rewrite – Reuters
US regulators said on Tuesday they will be giving the public an extra 30 days to comment on a proposed rewrite of the “Volcker Rule” banning proprietary trading by banks.
BOJ’s Kuroda Warns of Risk from High-Frequency Trading – Reuters
Bank of Japan Governor Haruhiko Kuroda has warned that the growing presence of high-frequency trading could exasperate price moves and hurt financial market stability.
Crypto News
Dividing the Cryptocurrency Sheep from the Blockchain Goats – The Economist
A favourite comparison drawn by cryptocurrency and blockchain enthusiasts is with the early world wide web. These technologies are only a decade old, they say. Trying to predict how they might change the world in the future is next to impossible.
Initial Coin Offerings Have Become Big Business – The Economist
Fundraising with cryptocurrencies is booming, but is that a good thing?
Bitcoin ETF Applicants ‘Don’t Fit the Mold’ for the SEC, Crypto Exec Says – CNBC
Cryptocurrency bulls have been hopeful that the US securities regulator will grant the first bitcoin exchange-traded fund (ETF) this year – but they’ve been left disappointed by a series of rejections and postponements.
Bitcoin Reaches 1-Month High as Crypto Markets Rally – Forbes
Bitcoin prices have been rising lately, hitting their highest in roughly one month earlier today.
The Bitcoin Boom Reaches a Canadian Ghost Town – Bloomberg
With fewer than 100 residents, Ocean Falls is looking for a revival after almost four decades of industrial false starts.
Company News
Up and Running – Profit & Loss
As Cobalt prepares to go live, co-founders Andy Coyne and Adrian Patten reflect on the difficulty for banks to innovate like they used to, why blockchain technology in its traditional format is ill-suited to processing FX transactions and why shared infrastructure is – finally – a reality.
Citi Launches 6th “e for Education” Programme – Profit & Loss
Citi has launched the 6th edition of its annual e for Education campaign, a global corporate social responsibility initiative that has raised over $22.5 million for education-focused non-profits since 2013.
No Transaction Fee on Cross Currency Derivatives Trade Till August 2019: BSE – Economic Times
Indian stock exchange BSE has extended the time period for not levying any transaction fee on the trades done in cross currency derivatives for one year till August 2019, to encourage active participation in the contracts.
Blockchain Industry Groups Announce Merger – Profit & Loss
The Post-Trade Distributed Ledger Group is set to merge with the Global Blockchain Business Council.
Market Savvy
Sterling Bounces Off Day’s Lows But Trade War Concerns Weigh – Reuters
Sterling bounced off a two-week low on Wednesday after a stronger than expected services PMI report but the British currency remained set for a fifth day of losses as broader concerns over Brexit negotiations hurt investor demand.
Dollar Bolstered By Fears of New US Tariffs on China – Reuters
The dollar rose broadly on Wednesday as concerns grew that US President Donald Trump may soon ramp up a trade war with Beijing by imposing tariffs on more Chinese imports.
No Relief in Sight for Emerging Markets as Rand Leads Sell-Off – Bloomberg
The rout in emerging markets showed no sign of letting up, with most currencies weakening and an index of stocks nearing a bear market. South Africa’s rand led the sell-off, falling to the lowest level in more than two years, followed by Mexico’s peso.
- Emerging Market Currencies Hit By Another Day of Turbulence – Financial Times (subscription)
- EM Slide Spreads Across Developing World – Financial Times (subscription)
- Rand Slumps as South Africa Enters Recession – Reuters
India Needs to Rethink Currency Management – Gulf Times
The economy is a fickle beast. Exactly a year ago, the rupee, having experienced a prolonged appreciating spree, had reached as high as 63.5 to a dollar. The trend of the rupee has entirely flipped this year.
Ten Years After Crisis, Central Banks Are at a Crossroads – The Wall Street Journal (subscription)
Over the next decade, investors will need to get used to the withdrawal of easy money.