Top Headlines

Deutsche Bank Said to Face Regulatory Fines Over Currency Trades – Bloomberg

Deutsche Bank is expected to be fined by the Federal Reserve and New York’s Department of Financial Services for its conduct in the foreign exchange market, a person familiar with the matter said.

SGX Must Improve Operational Resilience: MAS – Profit & Loss

The Monetary Authority of Singapore (MAS), has directed Singapore Exchange (SGX) to implement measures to enhance its recovery processes and operational resilience.

Dollar Bulls Checked By US Rate Policy and Trade Concerns – Financial Times (subscription)

The US dollar is being hit by investor reaction to the Federal Reserve’s measured policy tone and concerns over the Trump administration’s protectionist trajectory and the legislative obstacles it faces.

Sterling Hits Three-Week High as UK Inflation Passes BoE Target – Reuters

Sterling jumped almost one percent to its highest level in three weeks, after data showed British inflation in February above the Bank of England’s two percent target for the first time since the end of 2013.

A Break in the Political Clouds? Euro Sweeps to Six-Week High After French Debate – Financial Times (subscription)

The euro is flirting with its highest level of the year as it takes advantage of a softening dollar and easing concerns about the eurozone’s political climate.

Big Banks Back Off Calls for Euro-Dollar Parity – Reuters

Reuters historic polling data shows all of the currency world’s top ten banks have now been forced substantially to back off the forecasts of a swift drop below parity which have been widespread since the dollar rallied strongly in late 2014.

Why the Euro Has Further to Run Against Canadian Dollar – Financial Times (subscription)

RBC Capital Markets, in its Trade of the Week note, reckons the euro’s run has further to go as fiscal and monetary factors offer the loonie, as the Canadian unit is known, little support.

Mexico Peso Firms to Strongest Since Trump Election – Reuters

Mexico’s peso firmed to its strongest since Donald Trump clinched the US presidency in November, tracking Latin American currencies higher after the US Federal Reserve signalled it would hike rates gradually.

Brazil Real at Four-Week High on Hopes of Capital Inflows – Reuters

The Brazilian real strengthened to a four-week high on hopes of strong capital inflows after a successful airport auction and in anticipation of US interest rates rising slowly in coming months.

Volatility Underlines the Dangers of Stop-Loss Orders – Euromoney

FX buy-siders aren’t convinced of the risk-management potential of stop-loss orders, after many were disappointed with results following big swings in volatility last year.

Machines and Markets: Five Areas to Watch – Financial Times (subscription)

The rise of algo trading and passive investing is bringing new patterns and pitfalls.

Regulatory News

Rookie Currency Traders Are Causing Trouble at Crucial Moments – Bloomberg

Perhaps it’s just the typical grousing of community elders, but last week, the Bank for International Settlements said there may be something to the notion.

G-20 Nations Renew Commitment to Global Bank-Capital Overhaul – Bloomberg

Finance chiefs of the Group of 20 nations renewed their pledge to finalize an overhaul of global bank-capital rules, but stopped short of making progress on certain proposals that have led to a standoff between Europe and the US. 

ECB Urges Brussels to Step Up Action Against Errant Governments – Financial Times (subscription)

The European Central Bank has urged Brussels to toughen up its sanctions procedure against governments who persistently fall foul of its economic rules, as it noted that over 90 per cent of reform recommendations had been ignored by member states last year.

Blockchain Potential Solution to Derivatives Repository ‘Disappointment,’ Giancarlo Says – MLex FS Core (subscription)

Christopher Giancarlo, head of the US Commodity Futures Trading Commission, said blockchain technology “offers a great deal of promise” as an eventual solution to failures in creating a global swaps data repository network.

US Office for Financial Research Calls for Mandatory LEI – FOW (subscription)

Richard Brenner, head of the US Office for Financial Research, has called for legal entity identifiers to be mandatory in regulatory reporting.

Cross-Border Exchange Mergers in Doubt: Jefferies – FOW (subscription)

Cross-border exchange mergers are increasingly hard to pull-off due to increasing regulatory divergence across different regional markets.

Company News

LCH Margin Changes Aim to Reduce Banks’ Funding Costs – Risk (subscription)

Changes to allow over-collateralisation by buy-side clearers should ease FCMs’ funding burden.

A New Survey of EU Corporations Suggests that 10% Could Move All Operations Out of London Post-Brexit – Business Insider

As many as 10% of European corporations could move all operations out of London as a consequence of Brexit, a survey from Swiss banking giant UBS suggests.

Bitcoin Steadies After Biggest Three-Day Tumble in Over Two Years – Reuters

Bitcoin regained its footing, having suffered its heftiest falls since early 2015 between Thursday and Saturday as investors sold the digital currency on worries about its future.

Market Savvy

Some Asian Currencies Slip as Investors Look for New Positives After Fed Hike – Reuters

Some Asian currencies weakened slightly as investors looked for fresh cues following the currencies’ big gains last week on the US Federal Reserve’s moderately dovish stance.

Australian Dollar Knocked as RBA Warns on Housing Market – Financial Times (subscription)

The dollarydoo was down 0.2 per cent at $0.7715 in early European trade, but had dropped by as much as 0.4 per cent after the minutes from the RBA’s March meeting warned of a “build-up of risks associated with the housing market”.

C$ Dips as Lower Oil Prices Offset Domestic Data Strength – Reuters

The Canadian dollar weakened against its US counterpart as lower oil prices offset strong domestic wholesale trade data, while investors weighed the G20’s decision to drop a pledge to resist trade protectionism.