Top Headlines

Daily FX Trade More Like $3 Trillion Than 5: CLS – Reuters

The world’s biggest financial market may be only half as big as you thought it was.

Pound Picks Up as UK Prepares to Trigger Article 50 – Financial Times (subscription)

Sterling is making a bright start to the week in which the UK government is widely expected to trigger Article 50 and begin formal talks on its EU exit.

What Will Happen to the Pound When Article 50 is Triggered? – Financial Times (subscription)

The reality of Brexit has already been priced into the currency, say analysts.

Dollar Rally’s Second Wind Hinges on Fed Clues About Rate Path – Bloomberg

Traders betting on further gains in the dollar aren’t being dissuaded by Friday’s slump in the U.S. currency after the February employment report showed robust jobs growth.

Euro Climbs to Three-Week High Against Dollar on Rate Speculation – Financial Times (subscription)

The euro climbed to its strongest level against the dollar since mid-February as the markets reassessed the odds of a December rate rise by the European Central Bank.

Citi’s South African FX Settlement Hearing Set – Profit & Loss

A Tribunal at South Africa’s Competition Commission will officially hear details of Citi’s agreed settlement with local authorities to end charges of collusion and market manipulation on May 22.

Lloyds, Two Others Dismissed from Yen Libor Litigation in US – Reuters

A US judge dismissed Lloyds Banking Group, ICAP Europe and Tullett Prebon as defendants from litigation alleging a conspiracy among many financial services companies to manipulate the yen Libor and Euroyen Tibor benchmark interest rates.

Norwegian Krone Falls After Inflation Update, But SEB Sees Buying Opportunity – Financial Times (subscription)

The krone fell to its weakest level against the euro since the US election on Friday after a disappointing inflation update, but analysts at SEB think the move capped off what had already been an “irrational” couple of weeks for the currency, which should soon resume its recent climb.

Political Risk Puts Forex Intervention in Vogue in Europe – Financial Times (subscription)

Foreign exchange intervention is fashionable. The Swiss do it, so do the Danes and the Czechs have joined the party.

Markets Defy Global Political Storms – Wall Street Journal (subscription)

Volatility levels in stocks, bonds and currencies have eased and big investors are avoiding major calls.

A Constant Work in Progress – Profit & Loss

The Global Code of Conduct will continue to evolve over time, which is good because there are still contradictions within the text, not least around the subject of (deep breath) last look and pre-hedging.

Regulatory News

US Attorney Preet Bharara Fired After Refusing Justice Department Request to Quit – Wall Street Journal (subscription)

Preet Bharara, the top federal prosecutor in Manhattan, said he was fired from his position as the Manhattan US attorney, after he defied a request by the Justice Department for the remaining US attorneys appointed by former President Barack Obama to resign.

BOE Draws Fire from Bankers as Hogg Appointment Scrutinized – Bloomberg

The Sunday Times newspaper reported that some commercial bankers have said that if Hogg remains in her post, they will use that as an argument that they should also be treated more leniently. 

EU Will Need London Financial Services, Merkel Lawmaker Says – Bloomberg

The UK and the European Union need to look at innovative solutions to maintain access to financial services in London after Brexit, according to a senior lawmaker in German Chancellor Angela Merkel’s governing coalition.

Banks See Pressure on Capital Ratios as ECB Tackles Risk Models – Bloomberg

Some European banks are seeing their capital ratios come under pressure as the region’s top supervisor takes a more conservative view of their risk models.

US Regulators Reject Bitcoin ETF, Digital Currency Plunges – Reuters

The US Securities and Exchange Commission denied a request to list what would have been the first US exchange-traded fund built to track bitcoin, the digital currency.

Company News

UBS Warns Non-Cleared Margin Rules Will Stunt Activity – The Trade

UBS has said the non-cleared margin rules and the delays to implementation across several jurisdictions will have severe affects on its OTC derivatives trading activities.

Thomson Reuters Adds MiFID II Tool – Profit & Loss

Thomson Reuters is creating a suite of reporting services that will support the workflow of market participants in their efforts to meet post-trade transparency requirements mandated by the Markets in Financial Instruments Directive II (MiFID II).

Non-Cleared Swaps Compression Battle Heats Up – Risk (subscription)

Fintech vendors are competing to reduce the amount of initial margin dealers must post on non-cleared derivatives trades; though banks caution that some solutions being tabled may prove too complex or costly to merit the investment, and that there is likely room for only one or two to survive.

Buy-side Seek Algos to Measure Info Leakage – The Trade

The majority of buy-siders agree the standard algos provided by brokers have room for substantial improvement, although just 24% said they send more than half of their daily order flow to custom algos.

Rosenthal Collins Nabs Sheng from RJO – Profit & Loss

Rosenthal Collins Group has announced the appointment of Hilton Sheng to the new position of president, structured products division.

Market Savvy

Emerging Assets Firmer Pre-Fed; Rupee NDFs Firm on Election Result – Reuters

The Indian rupee hit 15-month highs on forward markets after regional elections confirmed the government’s grip on power, while other emerging market currencies also firmed as the dollar and US yields slipped from multi-week highs. 

South Korean Stocks, Currency Rise After Park Leaves Presidential Residence – Financial Times (subscription)

South Korea’s stock market and currency climbed after the country’s ousted leader left the presidential Blue House in Seoul.

C$ Rises as Jobs Gain Tempers Expected Policy Divergence – Reuters

The Canadian dollar strengthened against its US counterpart as solid domestic jobs data tempered expectations for policy divergence between the Bank of Canada and the Federal Reserve.