Top Headlines

City Regulator Confirms 15-Month Grace Period in Event of No-Deal Brexit – Financial News

The UK’s financial watchdog will give City firms a 15-month grace period to comply with the new regulatory environment in the event the country leaves the European Union without a deal on March 29.

ECB to Oversee Large Investment Banks Following Brexit – The Wall Street Journal (subscription)

The European Central Bank will assume oversight of the largest investment banks setting up offices in continental Europe, in a move designed to centralize regulation in the European Union following the UK’s exit from the bloc. Currently, banks’ European broker-dealer operations are overseen by a patchwork of national authorities.

If JP Morgan is Hurting, What Hope for Europe? – Bloomberg

It’s shaping up to be another tough quarter for securities firms, the world’s biggest trading house has warned. JP Morgan’s grim assessment of market conditions this year is more than a stark reminder that the wallet keeps shrinking.

FX Traders Unconvinced By Clearing: INTL FCStone – Global Investor (subscription)

Hedge funds are comfortable with the prime broking system for FX and FX options markets.

Regulatory News

Brexit Survey: Banks Struggle with Politics, Novations, Relocation – Tabb Forum

As the UK’s exit from the EU reaches its final countdown, heads of product and senior in-house lawyers at banks are accelerating their post-Brexit plans. Here, both buy- and sell-side firms candidly reveal their product concerns, relocation strategies, repapering struggles and the internal politics surrounding it all.

Giancarlo Opens Door for Prop Firms to Quote Swaps – (subscription)

CFTC will grant no-action relief to non-banks that want to provide liquidity in cleared swaps.

Volume ‘Non-Existent’, But SOFR Backers are Upbeat – (subscription)

An industry group tasked with replacing US dollar Libor is confident that liquidity in interest rate swaps linked to the secured overnight financing rate (SOFR) will begin to percolate, despite scant volume so far.

CFTC Official: CCPs Should War-Game Default Auctions – (subscription)

Clearing houses must think carefully about whom they invite to participate in default auctions, a senior official at the US Commodity Futures Trading Commission has said, in one of the first public comments from a national supervisor on auction practices at central counterparties in the wake of the recent Nasdaq Clearing episode.

US Prepares Final China Trade Deal as Hawks Urge Caution – Bloomberg

US officials are preparing a final trade deal that President Donald Trump and his Chinese counterpart Xi Jinping could sign in weeks, people familiar with the matter said, even as a debate continues in Washington over whether to push Beijing for more concessions.

Crypto News

Bankers Weigh in on JPM’s New Digital Coin – Euromoney

JPMorgan announced that it will be the first American bank to launch its own digital currency, but what do other bankers think of it?

Bitcoin Gets a Boost from JP Morgan’s Embrace of Cryptocurrencies – Bloomberg

Bitcoin is approaching $4,000 for the first time since the start of the year, as the largest cryptocurrency gets a delayed boost from the announcement last week that JP Morgan has developed a prototype digital coin that it plans to use to speed up payments between corporate customers.

Crypto Hedge Fund Shutdowns are Leading to Layoffs in the OTC World – The Block

Crypto winter has finally found its way to a corner of the digital asset market known for its high margins: over-the-counter trading. 

Singapore’s Sovereign Wealth Funds Eye Crypto – Finews Asia

Despite the collapse of crypto prices in 2018, the entrance of a large state investment fund into a major crypto exchange appears to align with a growing tide of stalwart investors entering this sector.

Company News

LMAX Exchange: Master of its Own Destiny – Profit & Loss

“2018 was a transitional year for foreign exchange,” reflects David Mercer, CEO of LMAX Exchange Group. The first thing he points to in order to back up this claim is the impact of new regulations, which changed the way that LMAX Exchange did business in a number of areas.

Oakley Rejoins Nomura as Head of Flow FX – FX Week (subscription)

Stuart Oakley is rejoining Nomura as the bank’s global head of flow FX. He previously was Nomura’s global head of emerging markets flow FX and head of emerging markets macro for the Europe, Middle East and Africa region.

Eurex Irks High Frequency Traders by Giving Investors an Extra Millisecond – GlobalCapital

From early summer, Eurex will begin to roll out a three-pillar strategy that is aimed at enticing more investors to trade in its order book. Some aspects of the strategy are already meeting resistance from some brokers and the more aggressive liquidity providers.

What They Said About CIB in 2018 – Euromoney

The biggest dozen global investment banks have now reported their results: here’s what their execs said about each of your businesses.

Surprise as Goldman Sachs Lets Go of Risk Managers First of All – eFinancialCareers

As Goldman Sachs makes its annual round of redundancies, insiders say risk managers have been among the first to feel the squeeze. This appears to have come as a shock in a function that’s become used to being treated gently, both at Goldman and elsewhere.

Market Savvy

Pound Set for Biggest Weekly Rise in a Month as No-Deal Brexit Fears Fade – Reuters

The pound slipped on Friday after survey data showed British factories slashing jobs in February but is headed for its biggest weekly rise in a month on receding fears that Britain will leave the European Union without a deal.

Dollar Recovers, Hits 10-Week High vs. Yen, as Bigger Yields Lure Investors – Reuters

The dollar moved higher on Friday, hitting a 10-week high against the yen, as a jump in US Treasury rates sent investors chasing higher yields into the greenback.

World’s Biggest FX Trade is in Tightest Range Ever – Bloomberg

The euro-dollar cross, which sees roughly $1.25 trillion of transactions a day, has traded in a 3.4-U.S. cent range since the beginning of 2019. With turbulence in developed-nation currencies at the lowest level in over a year, strategists at Goldman Sachs and Societe Generale don’t expect it to break out anytime soon.

Markets Must Adjust to a New Type of Sudden Shock – Financial Times

It isn’t your imagination, markets really have become more tempestuous. But instead of extended storms, they are suffering shorter but more intense hurricanes. That raises some interesting questions over whether this is just a statistical oddity, a cyclical shift, or a structural change in the financial system.