FXPA Responds to FEMR’s Final Report

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FXPA Responds to FEMR’s Final Report

The Foreign Exchange Professionals Association (FXPA) supports the Final Report published by the Fair and Effective Markets Review (FEMR) today, which sets out 21 recommendations to help restore trust in the wholesale Fixed Income, Currency and Commodity (FICC) markets.

FX Industry Responds Positively to Calls for Increased Accountability – Profit & Loss (free story)

The theme of accountability for both individuals and firms in financial services that was prevalent in both Mark Carney’s Mansion House speech and the final version of the Fair and Effective Markets Review (FEMR), has elicited a positive response from FX market participants.

BoE’s Carney: The “Age of Irresponsibility” is Over – Profit & Loss (free story)

In a speech to a City audience of bankers and merchants at the Mansion House in London, Mark Carney, governor of the Bank of England, drove home the message that the “age of irresponsibility” in finance is over.

FEMR Inconclusive on the Future of “Last Look”; Advocates for “Time Stamps”- Profit & Loss (free story)

The Fair and Effective Markets Review (FEMR) has concluded there should be clearer standards regarding the use of “last look” in the FX market, but did not definitively state whether the practice should be banned. FEMR also voiced support for the use of ‘time stamps’ on client orders.

Deutsche’s Grip on Asia FX Market May Slip on Jain’s Exit – Reuters

The exit of Deutsche Bank co-chief executive Anshu Jain may see the lender surrender its strong position in Asia’s fast growing foreign exchange and fixed income markets, with incoming CEO John Cryan expected to cut some of the capital-intensive businesses Jain oversaw.

Corporates Continue to Shun FX Algo Trading – Euromoney

While hedge funds increase their use of algorithms, corporates continue to execute only modest volumes.

Regulatory News

FEMR Calls for New Spot FX Market Abuse Regulation – Profit & Loss (free story)

The Fair and Effective Markets Review (FEMR) released today, advocates for the creation of a new regulatory framework for FX spot market abuse in the UK.

FEMR: More Work Needed on a Global Code of Conduct for FX – Profit & Loss (free story)

The Fair and Effective Markets Review has backed the creation of a global code of conduct, but warns that “substantial further work is needed to raise standards in FX markets”.

UK Plan to Extend City Regulation Provokes Mixed Response – Financial Times (tiered subscription)

A punitive regime that holds senior managers to account for failings on their watch will be extended beyond banking and insurance to thousands of asset managers, hedge funds and other bank customers in the fixed income, commodity and currency markets.

Citigroup’s Paid 2,500 Times More for FX Rigging than it Made – Bloomberg

Jamie Forese, head of the Citigroup Inc unit that houses trading and investment banking, said fines the firm paid for rigging foreign-exchange markets dwarfed the amount generated by the illegal conduct.

Company News

Russell Investments Selects Head of Currency and Fixed Income Strategy – Pensions & Investments

Van Luu joined Russell Investments as head of currency and fixed income strategy, a spokesman said.

State Street Starts Currency-Hedged ETF to Attract Money – Bloomberg

State Street Corp, which opened the first U.S. exchange-traded fund in 1993, is starting its first currency-hedged ETF, following similar offerings from firms including WisdomTree Investments Inc.

Market Savvy  

Canada FX Debt – C$ Strengthens in Commodity-Linked Rally – Reuters

The Canadian dollar strengthened further against its US counterpart on Wednesday, boosted by a rise on oil prices as volatility in currency markets favoured the commodity-linked loonie.

The New Currency Trade: Short the Kiwi – CNBC

Currency analysts are betting on continued declines for the New Zealand dollar as officials fight to boost growth in a country that was heralded as 2014’s rockstar economy.

Press Releases

Fair and Effective Markets Review releases Final Report

The Fair and Effective Markets Review today published its Final Report, which sets out 21 recommendations to help restore trust in the wholesale Fixed Income, Currency and Commodity (FICC) markets.

Building Real Markets for the Good of the People – Speech by Mark Carney

Speech given at the Lord Mayor’s Banquet for bankers and merchants of the City of London at the Mansion House, London.

Industry Events