Top Headlines

Citi Joins UBS in Setting Up Singapore Currency Trading Hub – Bloomberg

Citigroup is planning to join UBS with an electronic currency trading and pricing platform in Singapore, setting up systems to boost liquidity in Asia’s biggest foreign exchange hub.

Dealers Suffer in Euro Rates Desert – (subscription)

Analysis shows a collapse in swap and bond bid/offer spreads, as traders say business is “unsustainable”.

Why Has the FX Swaps Market Not Become More Automated in Recent Years? (opinion) – Profit & Loss

Over the years the most powerful criticism aimed at e-commerce and its potential impact on markets has not been about volatility or market behaviour generally, it is its lack of flexibility – why else, for example, has the FX swaps market not become more automated in recent years?

In the FICC of It (podcast) – Profit & Loss

The podcasters discuss a website set up by Barclays’ former head of automated trading David Fotheringhame that is “a public defence of last look”. The discussion then moves on to exchanges in FX as the podcasters ask, “Will scale win the day?” and “How does a small independent firm succeed in such an environment?” As always they have the answers (of a sort!) including the suggestion that a market structure will (finally) lead to the creation of an electronic market in FX swaps.

The Gazillion-Dollar Standoff Over Two High-Frequency Trading Towers – Bloomberg

The hunt for a millionth-of-a-second advantage in the town best known for Wayne’s World is getting heated.

Regulatory News

Hundreds of Finance Companies Leave UK to Cope with Brexit Chaos – Financial News

More than 275 of London’s biggest finance companies have relocated, moved staff or set up new entities overseas to brace themselves for Brexit disruption, with the number expected to “increase significantly” in the next few years.  

Frustration Over Mifid and Priips Nears Boiling Point – Financial Times

Ambitious plans to transform Europe’s investment industry have led to a backlash against regulators from asset managers infuriated by the vast extra workload and higher costs.

How Do You Replace the Most Important Number in the World? – Bloomberg

As markets prepare to move away from the benchmark Libor, they risk sparking confusion and chaos. 

US, China Have Reached Consensus on Many Vital Issues, Yi Says – Bloomberg

China and the US have reached consensus on many “crucial” issues and and have discussed the need to observe the “autonomy” of each other’s monetary policy, People’s Bank of China Governor Yi Gang said.

House Democrats Reject Transaction Tax That Hits Close to Home – Politico

Moderate Democrats representing the nation’s major financial centers are pushing back against a proposed tax on the sale of stocks, bonds and derivatives, saying the promised benefits wouldn’t materialize and that states like New York could see collateral damage.

Crypto News

LMAX Digital Gets In Principle Crypto Nod in Gibraltar – Profit & Loss

LMAX Digital, the institutional crypto currency exchange operated by LMAX Exchange Group, has announced that it has received an in-principle decision on the firm’s application for a license as a distributed ledger technology provider from the Gibraltar Financial Services Commission. 

Blockchain, Yesterday’s Hype, Transitions Into Something Else – The Wall Street Journal (subscription)

When it first came to light, blockchain had no broader goals beyond supporting bitcoin. But, as was the case with the Internet and World Wide Web, blockchain soon transcended its original objectives.

Chicago Chases the Pot o’ Crypto – Crain’s Chicago Business

Trading heavyweight Don Wilson is backing one of three nascent cryptocurrency exchanges vying to lure big institutions and their big money to digital currency markets.

Fidelity Digital Assets Goes Live with First Cohort of Clients for Crypto Offering – The Trade Crypto

Fidelity Digital Assets will offer trading and custody of cryptocurrencies to institutional investors such as hedge funds, family offices and market intermediaries.

Winklevoss Twins Preach Trust, More Regulation for Crypto Market – Bloomberg

Building trust is key to regaining confidence among cryptocurrency traders after the death of a prominent exchange executive prevented thousands of people from accessing their accounts, according to Tyler and Cameron Winklevoss.

JP Morgan’s Stablecoin: A Feat of Engineering or Marketing? – CoinDesk

The world of blockchain and banking was set alight last month by the announcement that JP Morgan has created its own stablecoin. It was a rare move that has simultaneously excited the banking and enterprise blockchain community as well those in the cryptocurrency world. But is this excitement justified?

Company News

CTAs See Performance Improve in February – Profit & Loss

Following a challenging start to the year, CTA indices showed signs of improvement in February, with over half of the constituents in the Societe Generale Trend Index in positive territory for the month.

Goldman Sachs to Add Hundreds of Women to the Trading Floor – Financial News (subscription)

Goldman Sachs is offering hundreds of new female recruits a one-year trial on its trading floors in an attempt to shake up its male-dominated workforce.

Germany’s Two Shrinking Banks May Get Closer to a Merger – Bloomberg

A merger of Deutsche Bank and Commerzbank is shaping up as the most likely endgame as Germany’s largest listed lenders are running out of time to show they can grow as standalone companies.

TraderTools Gets Investment, Makes Hires – Profit & Loss

TraderTools has hired Andreas Putz as director of sales and Rich Pisarra as liquidity manager in New York, following new investment into the firm.

Bank Leumi (UK) Signs with Eurobase – Profit & Loss

Bank Leumi (UK) has selected Eurobase’s Siena platform to support its FX treasury management. The bank, which is the London-based subsidiary of Israel’s international bank, offers a range of corporate banking services to both UK-based and international clients.

Market Savvy

Sterling Falters Amid a Lack of Brexit Progress – Financial Times

Sterling has stumbled at the start of yet another testing week in the process of the UK’s exit from the EU, stung by the apparent lack of progress in securing a deal on the terms of the divorce.

Dovish Fed and Weak Jobs Data Fail to Tame Dollar – Financial Times

The dollar has been quietly creeping higher this year, and nothing — not even concerns over prospects for the US economy and interest rates — seems able to halt it.

Rate Hike Bets Send Norway’s Crown to 4-1/2 Month Highs – Reuters

The Norwegian crown climbed towards its highest levels in more than four months against its Swedish rival on Monday after strong inflation data raised expectations the central bank could increase interest rates as early as this month.

Hong Kong Tightens Liquidity With $192 Million Peg Defence – Bloomberg

Hong Kong faces the likelihood of rising borrowing costs after the city’s de facto central bank intervened to defend its currency peg for the first time since August.

Yuan Gains Expected to Be Capped as China Pushes Against US – Bloomberg

Any strength in the yuan will likely be restrained as China’s top trade and monetary policy officials delivered this weekend a subtle push-back against trade demands made by Washington, analysts and investors said.