Top Headlines

China’s Central Bank Prioritizes Strong Yuan When Managing Liquidity –Wall Street Journal (subscription) China’s central bank faces a tough balancing act, trying to ease credit in the financial system without adding to pressures weakening the Chinese currency.

Desperate in Davos: Policymakers Struggle for Answers – Reuters Angela Merkel was missing from Davos this year, but the German leader’s optimistic mantra “we can do this” echoed through the snowy resort in the Swiss Alps.

Dollar Edges Down But Close to Recent Highs; Fed, BOJ in Focus – Reuters The dollar edged down on Monday but remained well off recent lows as markets started the week on a calmer note and investors turned their attention to upcoming central bank meetings.

There’s a Giant Elephant at the Bank of England – Bloomberg It’s a new year and Bank of England officials have been sharing their views on the outlook for the U.K. and the risks. Well, some of the risks.

China to Set Up its Own Virtual Currency – The Register The People’s Bank of China (PBOC), China’s central bank, hopes to launch its own virtual currency to cut the cost of handling paper money and to give the government more control of the country’s money supply.

Russian Officials Seek to Reassure Markets They Have Control Over Ruble – Wall Street Journal (subscription) Top Russian officials Friday sought to reassure markets they have control over the ruble and that its drop to all-time lows has a silver lining.   

No Crisis’ Norway Holds Talks on Economic Cost of Oil’s Plunge – Bloomberg Norway’s prime minister, finance minister and central bank governor are holding an extraordinary meeting to assess just how bad the deepening plunge in the price of oil will be for the overall economy of Western Europe’s biggest petroleum producer.



Regulatory News

Kuroda Advises China to Impose Capital Controls to Defend Yuan – Bloomberg Bank of Japan Governor Haruhiko Kuroda said China should impose capital controls to defend the yuan rather than keep burning through currency reserves.

CFTC Grants Final Registration to 18 SEFs – Profit & Loss The US Commodity Futures Trading Commission (CFTC) has granted final registration to 18 swap execution facilities (SEFs). Prior to this, the SEFs had been operating under a temporary registration status.

Canadian Securities Regulators Implement Derivatives Reporting Rules – MondoVisione Securities regulators in Alberta, British Columbia, New Brunswick, Newfoundland and Labrador, Northwest Territories, Nova Scotia, Nunavut, Prince Edward Island, Saskatchewan and Yukon (the participating jurisdictions) today announced the implementation of new Multilateral Instruments 91-101 Derivatives: Product Determination and 96-101 Trade Repositories and Derivatives Data Reporting.

U.S. Banks Cut Off Mexican Clients, as Regulatory Pressure Increases – Wall Street Journal (subscription) U.S. banks are cutting off a growing number of customers in Mexico, deciding that business south of the border might not be worth the risks in the wake of mounting regulatory warnings.



Company News

Cross Joins HSBC GAM – Profit & Loss Former head of the FX division at the Bank of England, Michael Cross, has joined HSBC Global Asset Management.

Asset Managers Need to Get Ready for a Big Tech Shift – eFinancialNews Asset management chief executives yet to develop a digital strategy should be locked in a dark room with their mobile phones until they find one.

IBM, Apple Profit Have Forex Risk as Hedges Come Off in 2016, Says Morgan Stanley – Barrons The disappointing profit outlook offered by International Business Machines (IBM) on Tuesday afternoon is a harbinger of pain to come for tech from foreign exchange this year, writes Morgan Stanley’s hardware analyst, Katy Huberty, in a note to clients.



Market Savvy  

Offshore Yuan Advances as Xinhua Claims Short Sellers Will Lose – Bloomberg The offshore yuan rose for the first time in five days after China stepped up verbal defense of its currency to ward off speculators betting on depreciation.

Market Volatility Did the Work of Four Fed Rate Hikes: Morgan Stanley – Bloomberg Volatility in financial markets since the Federal Reserve last month announced its first interest-rate increase in nearly a decade is having the same effect as four additional quarter-point hikes, according to Morgan Stanley.

Hong Kong Dollar Likely to Come Under Additional Pressure This Week – South China Morning Post The battle between currency speculators and Hong Kong Monetary Authority will remain in focus this week amid a gloomy market sentiment worldwide.

Currency Woes Lead Brazil to Offer Support for Companies – Financial Times Brazil’s central bank is helping Brazilian companies to cope with market volatility by offering programmes to hedge currency risk.



Press Releases

Falling EM Claims Lead to Lower Q3 Cross-Border Lending – BIS – Profit & Loss The latest quarterly international banking statistics from the Bank for International Settlements (BIS) show cross-border bank lending shrank for the second consecutive quarter, driven by falling claims on major emerging market economies.



Industry Events