Citigroup Takes FX Crown, But Rules of Engagement Change – Wall Street Journal (subscription)
Once a year, all eyes in the $5.3 trillion a day foreign exchange industry are set on only one set of data: the market share rankings published by Euromoney Institutional Investor. And in 2015 the winner is… Citigroup. But for the first time in the 37 years the survey has been published, the rules of engagement have changed.
Regulation Alone Will Not Restore Faith in Markets – Financial Times(subscription)
Few mechanisms underpin modern life to quite the same extent as the wholesale markets that lie at the heart of the financial system. What may seem like arcane bits of financial plumbing, these determine the borrowing costs of households and companies, the prices at which currencies are exchanged and influence the cost of basic necessities such as food and raw materials. They are also, as recent history attests, prone to manipulation. Recent scandals have rightly caused regulators to review their laissez-faire approach to overseeing the wholesale markets on which such benchmarks are based.
Banks in Political Crosshairs After FX Fines – Profit & Loss (free story)
US politicians could look to use the FX fines issued to the banks last week for their own political purposes, with Senator Elizabeth Warren already being outspoken on this topic. Specifically, Warren has voiced concerns over the waivers granted to the banks that pleaded guilty to FX malpractice as part of their settlement deals.
Currency Traders Speculate Against Riksbank With Krona Bet – Bloomberg
Currency traders have started to test the Swedish central bank’s sensitivity to krona gains as policy makers acknowledge exchange-rate moves are putting their goals at risk.
PBOC Sets China Yuan at One-Month Low After IMF Says Currency ‘No Longer Undervalued’ – South China Morning Post
China’s central bank set the benchmark midpoint rate of its currency at the weakest level in a month against the US dollar on Wednesday, after the International Monetary Fund said in its report that the currency is no longer undervalued.
Currency Hedging: Does it Still Work in Japan and Europe? – Citywire
Over most timeframes, UK investors in Japan and Europe who have hedged the yen and euro have reaped stronger returns. In the last year, three years and five years, the picture has been the same: of the pound strengthening against those currencies, and chipping away at the returns of those with unhedged exposure.
What Does the Future Hold for Exchange-Traded FX in Europe? – the Trade
The push by exchanges to boost their FX volumes has continued in earnest in the last few years. FX on the CME is currently trading at around $108 billion of daily volume, still a drop in the ocean compared to over-the-counter (OTC) volumes, but it is growing to attract at least a small sliver of the market.