FX Manipulation Litigation Heads to Europe

globalFXsource0

Top Headlines

FX Manipulation Litigation Heads to Europe – Profit & Loss (free story)
US law firm Scott + Scott is reportedly preparing a new multi-million pound legal case on behalf of European plaintiffs against a number of major banks for FX market manipulation, after achieving success in a similar case in the US.

Brazil Central Bank Currency Dealers are Under Investigation – Bloomberg
Six of the 14 financial institutions consulted by Brazil’s central bank on a daily basis to set the reference exchange rate are under investigation for alleged currency manipulation.

‘Learn to Love the Bombshell’ With Yellen Ahead – Financial Times(subscription)
Brace, brace. Fed chair Janet Yellen takes the stage at 1.30pm London time with her two-day semi-annual testimony to Congress.

Currency Trading Shifts to Multi-Dealer Systems, Greenwich Says –Bloomberg
Currency investors are increasingly using electronic systems connected to multiple dealers as the market comes under greater scrutiny by regulators, according to Greenwich Associates.

NY Fed Official to Currency Traders: Adhere to Industry Best Practices – Wall Street Journal (subscription)
The man responsible for implementing Federal Reserve monetary policy said currency traders need to show they are adhering to industry best practices or face tighter regulation, the latest salvo in the government’s response to currency market manipulation.

Investors Wary of Swiss Franc Bets After Getting Burned – Wall Street Journal(subscription)
Six months after a sudden surge by the Swiss franc rocked financial markets around the globe, investors are largely steering clear of bets on a currency they once considered to be among the safest.

New Report Outlines Buy-Side’s Derivatives Concerns – the Trade
Trading costs, market access and sell-side retrenchment are the top concerns for buy-side firms active in listed derivatives trading, according to a new research paper.

BlackRock Vies With State Street to Tap Currency-Hedged ETF Boom –Bloomberg
The world’s biggest money managers are staking a claim in the surging market for stock and bond ETFs that strip out currency risk.

Hold the Line – the Trade
The Investment Association has moved to reject suggestions that asset managers are a source of systemic risk to the global economy.

China Derivatives Market Growth Lags Economic Development – Risk.net(subscription)
While GDP growth has been spectacular, derivatives growth is muted.

Regulatory News

ISDA Publishes EMIR Classification Letter – Profit & Loss (free story)
The International Swaps and Derivatives Association (ISDA) has published a new classification letter that will enable counterparties to notify each other of their status for clearing and other regulatory requirements under the European Market Infrastructure Regulation (EMIR).

€10 Trillion Investor Group Weighs in on Failing CCPs – Financial News(subscription)
BlackRock, Schroders, Fidelity and others write to Lord Hill to add their voices to the debate on how to wind down a failed clearinghouse.

Statement of Commissioner Giancarlo on the DMO Made Available to Trade Process Roundtable (press release)
CFTC Commissioner Giancarlo recommends that the DMO roundtable today reconsider this rule set that is not supported by the Dodd-Frank Act and runs counter to long-settled constitutional precedent surrounding the Commerce Clause.

SEC’s White Remarks at the Compliance Outreach Programme for Broker-Dealers (press release)
SEC Chair Mary Jo White addresses the SEC and FINRA’s “2015 National Compliance Outreach Programme for Broker-Dealers”, held in Washington, DC.

North Carolina Senate Committee Advances Bitcoin Bill – CoinDesk
A legislative bill that would cover Bitcoin and digital currency related business activities has advanced in the North Carolina Senate.

Company News

Currency-Trading Boost Helps Icap – Financial Times (subscription)
The end of a dull spell in currencies is helping broker Icap, but the company is still holding out for more clarity on the path of US interest rates.

JP Morgan’s Profit Rises – Wall Street Journal (subscription)
JP Morgan Chase’s second-quarter profit increased 5.2% as the firm cut costs and benefited from strong deal-making activity that helped offset weaker trading revenue.

Market Savvy  

Aussie Improves on China GDP, Eyes on Yellen
Reuters
The Australian dollar tiptoed close to its highest in two weeks on otherwise quiet major currency markets on Wednesday, supported by stronger data out of China as traders awaited a speech by US Federal Reserve chair Janet Yellen.

Watch Earnings as MPC Turns More Hawkish
BNP Paribas
In testimony Wednesday, BoE Governor Carney noted that the “point at which interest rates may begin to rise is moving closer given the performance of the economy”, while Deputy Governor McCafferty said the balance of inflation risks is shifting. In a speech later that night, MPC member David Miles noted that the “time to start normalization is soon” and that inflation would likely increase sharply in 2016.

FX Update: Waiting for Yellen
Saxo Bank
Today it looks like we may finally be able to shift the focus from Greece for a while as its parliament moves to vote through the bailout deal, with the assumption that the opposition and a minority of the Syriza party will provide enough of a majority.

Press Releases

ICE Benchmark Administration Publishes Feedback Statement for LBMA Gold Price Consultation
Intercontinental Exchange, a global network of exchanges and clearing houses, has published a feedback statement on the responses received to the ICE Benchmark Administration (IBA) market consultation on the LBMA Gold Price and the gold auction process.

Industry Events