China Forex Reserves in Record Fall as Beijing Tries to Calm Markets

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Top Headlines

China Forex Reserves in Record Fall as Beijing Tries to Calm Markets – Reuters China’s foreign exchange reserves posted their biggest monthly fall on record in August, reflecting Beijing’s attempts to halt a slide in the yuan and stabilize financial markets following its surprise move to devalue the currency last month.

China’s Stock-Rescue Tab Surges to $236 Billion, Goldman Says – Bloomberg China’s government has spent 1.5 trillion yuan ($236 billion) trying to shore up its stock market since a rout began three months ago, according to Goldman Sachs Group Inc.

Structured-Note Ban in FSB Bank-Crisis Rule Has ‘Strong’ Backing – Bloomberg The Financial Stability Board plans to retain a ban on structured notes in new rules intended to keep taxpayers off the hook when the world’s biggest banks fail, disregarding industry opposition.

Rate Worries Pose Obstacle for Banks – Wall Street Journal (subscription) Market tumult has taken a hefty toll on bank shares, investments expected to benefit from rising interest rates.

Former Citi FX Trader set to Challenge Dismissal in London Court – Reuters A former Citigroup foreign exchange trader is to challenge his dismissal at a London court on Tuesday, potentially the first of many such cases in the wake of the currency market rigging scandal.

 

 

Regulatory News

Bank Regulation: Regulators Seek Data on Systemic Risk – Euromoney The astonishing plunge in global stock markets in August failed to ignite fears over the health of balance sheets of international banks. But markets should not be complacent.

US SEC’s Gallagher Says will Leave his Post by Oct 2 – Reuters US Securities and Exchange Commission Republican member Daniel Gallagher announced on Friday that he will not stay on at the agency past Oct. 2.

SEC’s Piwowar Doubts CCPs Should Clear Some Instruments – Risk.Net (subscription) SEC Commissioner says some derivatives products would be better left outside clearing houses, due to jump-to-default risk.

 

 

Company News

Bloomberg and Traiana Team Up – Profit & Loss Bloomberg’s STP Solutions unit and Traiana have unveiled a joint effort to develop a straight-through processing infrastructure to further streamline the workflow of FX options.

First on-Sef NDF Cleared by ForexClear – FX Week (subscription) The LCH.Clearnet-owned platform clears the first on-Sef non-deliverable forward between Virtu and Societe Generale.

LMAX is the UK’s Sixth Fastest-Growing Tech Company – FX Week (subscription) For the third year in a row, the platform features on the Sunday Times’ Tech Track 100 table FX platform.

 

 

Market Savvy  

Dollar Retreats With Treasuries, Yen as Shanghai Stocks Rebound – Bloomberg The dollar weakened with the yen and Treasuries as a late rally in Shanghai helped calm markets after Chinese trade data spurred global demand concerns one week before the Federal Reserve decides whether to increase U.S. interest rates.

Hedge Fund VIX Positions Double in Bet Stock Turbulence to Last – Bloomberg Now that turbulence has resurfaced in the stock market, the biggest traders are piling into bets that it’s going to last.

Chinese Investors Lose 30% of Their $40 Billion Investment in Australia due to FX losses – Basis Point Chinese investments in Australia totalling $40.3 billion have lost 30% of their value due to the weakness of the Australian dollar vs the Chinese Yuan over the past two years.   An Obscure Hedge Fund Is Buying Tens of Billions of Dollars of US Treasurys – Wall Street Journal (subscription) A little-known New York hedge fund run by a former Yale University math whiz has been buying tens of billions of dollars of US Treasury debt at recent auctions, drawing attention from the Treasury Department and Wall Street.

 

 

Press Releases

Federal Republic of Germany Becomes New Clearing member of EurexOTC Clear Active participation in Eurex Clearing’s service for interest rate swaps planned to start in Q4/2015.

 

 

Industry Events