Top Headlines

Dollar Slides as Foreign Central Bankers Signal Policy Tightening in Europe, UK – Wall Street Journal (subscription)

String of foreign central bankers hint they could move away from ultraloose monetary policy.

Dollar Index at Lowest Level Since Trump’s Election – Financial Times (subscription)

Broad weakness for the dollar has taken the index tracking the world’s reserve currency back to its lowest level since October, as investors’ reassessment of the outlook for global monetary policy leaves it looking vulnerable.

Hawkish Bank of England Sends Sterling Above $1.30 – Reuters

Sterling rose above $1.30 for the first time in five weeks, investors taking stock of increasing signs the Bank of England is looking at tightening monetary policy.

Euro Hits 14-Month High in Third Day of Gains – Reuters

The euro jetted past $1.14 to its highest in just under 14 months, with attempts by European Central Bank sources to moderate the message taken from a speech by President Mario Draghi this week falling on deaf ears.

Whinge, Whinge, Whinge – Profit & Loss (subscription)

Is it fair on one hand complain about the lack of volatility, while at the same time complain about flip-flopping central bankers triggering these moves?

Renminbi Hits Strongest Level in Seven Months as Xi Visits Hong Kong – Financial Times (subscription)

China’s currency firmed to its strongest level against the dollar since November 9 as Xi Jinping arrived in Hong Kong for the twentieth anniversary of the territory’s handover from the UK.

Is Active Currency Management Making a Comeback? – Profit & Loss

A new report finds that institutional investors are taking a more active approach to managing portfolio-wide currency risks, and in particular there is a greater appetite for active currency overlays.

Southeast Asian Tiger Economies Look to Avoid Crisis Repeat – Financial Times (subscription)

The financial turmoil sometimes known in Thailand as the tom yum goong crisis erupted with the baht’s devaluation 20 years ago on Sunday.

Regulatory News

Columbia Professor Jackson Leads Field for SEC Job: Sources – Reuters

Columbia University law professor Robert Jackson is a leading contender for one of the two commissioner vacancies on the US Securities and Exchange Commission, according to people familiar with the matter.

House Lawmakers Target Wall Street Rules in Spending Plan – Wall Street Journal (subscription)

GOP-backed draft bill would unwind parts of Dodd-Frank by repealing Volcker rule and targeting CFPB for restructuring.

Fed Paper Reignites Debate on Bank Capital Ratios – Risk (subscription)

US industry association criticises official analysis suggesting optimal Basel ratios of up to 26%.

Yellen: Banks ‘Very Much Stronger’; Another Financial Crisis Not Likely ‘In Our Lifetime’ – CNBC

Fed Chair Janet Yellen said the banking system is “very much stronger” due to Fed supervision and higher capital levels.

Dodd-Frank Has Increased “Too-Big-to-Fail” Risk – FOW (subscription)

The US financial reforms have failed on various levels, according to Craig Pirrong.

European Regulator ‘May Intervene’ in Risky Retail Trading; FCA Still ‘Seriously Concerned’ – Financial Times (subscription)

The European Securities and Markets Authority is considering taking a tougher line on online tools popular with retail traders, while the UK financial watchdog also criticised trading firms for persistent weakness in their customer protections.

Company News

CME Gets Green Light for OTC FX Options Clearing Launch – Profit & Loss

CME Group has received regulatory clearance from the US Commodity Futures Trading Commission (CFTC) to start providing clearing services for OTC FX options.

Currency Headwinds Lighten but Unlikely to Remain So: Report – Profit & Loss

The latest quarterly report from Fireapps shows that currency headwinds for those corporations that reported them fell to $6.7 billion in Q1 2017 – mainly thanks to North American firms reporting a $6.47 billion negative currency impact on earnings. This compares to a collective $16.88 billion hit in Q1 2016, the firm says.

Report: Liquidity, Funding Challenges Shifting Buy Side Behaviour – Profit & Loss

Market and regulatory reforms are forcing buy side firms to look for new ways of accessing collateral, funding and liquidity, according to a new report from BNY Mellon and PWC.

Britain Warned Ireland Against ‘Opportunistic’ Brexit Attack on City – The Telegraph

Britain warned Ireland not to launch an “aggressive and opportunistic” campaign to steal business from the City of London in the wake of Brexit vote, a senior figure in Ireland’s Investment and Development Agency (IDA) has revealed.

Market Savvy

The Ringgit Is Easily Asia’s Strongest Currency – Bloomberg

The ringgit is easily the strongest major Asian currency this quarter, climbing twice as much as the next best, the Chinese yuan.

Dollar Softens Further in Asia Trade as Region’s Currencies Rally – Financial Times (subscription)

Virtually every major international currency was gaining on the dollar in morning Asia trade in what was shaping up to be another rough day for the greenback.

C$ Notches Biggest Gain Since March as Rate Hike Bets Jump – Reuters

The Canadian dollar scored its biggest gain in three months against its US counterpart, as hawkish comments by Bank of Canada Governor Stephen Poloz raised expectations of an interest rate hike as early as July.