Top Headlines

G20 Leaders Find Common Ground on Currency as Curtain Comes Down on Hangzhou Summit – South China Morning Post

The world’s 20 major economies will talk to each other on exchange rates and refrain from a currency race to the bottom as part of a joint policy package to soothe financial markets and revive global growth. 

FX Volatility Responsible for Major Shifts in Fund Rankings – Pensions & Investments

While the names in the ranking of the 20 largest pension funds in the world were unchanged in 2015 vs. 2014, there was plenty of movement.  

Chinese Capital Controls Deterring Outflows – Financial Times (subscription)

FT Confidential Research survey finds less demand for forex amid stability and capital controls.

Daily Retail FX Volumes Down in Q2 – Reuters

Foreign exchange trading through online retail brokers fell by 7 percent in the second quarter of 2016, with a boom in sterling trading around June’s Brexit vote not enough to fuel expansion of one of the currency world’s few recent drivers of growth. 

Aussie Gains as RBA Keeps Quiet on Currency Strength – Reuters

Australia’s dollar was the biggest gainer among major currencies as US and European traders returned from summer holidays on Tuesday, jumping almost 1 percent after the country’s central bank said little on its 10 percent rise since January.

No Basis Seen for Long-Term Drop in Chinese Currency – The China Post

Experts expect the renminbi to remain stable against a basket of currencies as there is no long-term basis for depreciation.

Switzerland’s Economy Grows at Fastest Pace Since 2014 – Bloomberg

A year after suffering an exchange-rate shock, the export-oriented Swiss economy appears to be finding its footing again.

Regulatory News

 Trade Surveillance Expands in FICC – Markets Media

Market surveillance is spreading from equities into fixed income, currencies and commodities following the market abuse regulations from the European Union coming into force in July.

China Eases Quota Restrictions for Foreign Institutional Investors – Reuters

China’s regulators on Monday issued revised rules on foreign institutional investments in the country’s domestic securities using the yuan currency, another step forward in opening up its markets and encouraging more fund inflows.

Analysis is Becoming Surveillance in Monitoring of Trades – Pensions & Investments

Trading analysis for money managers is moving beyond traditional transaction cost analysis — ensuring best execution and cost control — to watching over the entire lifecycle of every trade.

Lenterman Back at the Helm of FIA EPTA – Profit & Loss

Remco Lenterman has been appointed chairman of the FIA European Principal Traders Association.

Czech C.Bank Governor: Could Exit FX Cap Even With Inflation Below Target – Reuters

The Czech central bank could exit from its weak crown policy around the middle of 2017 even if inflation is still slightly below the bank’s 2-percent target, Governor Jiri Rusnok was quoted as saying on Monday.

Company News 

Virtu Struggling With Swaps Market Making Expansion – The Trade

Proprietary trading firm Virtu Financial has struggled to expand its market making services to the interest rate swaps market, according to its chief executive.

Businesses Urged to Hedge Baht in Face of Volatility – Bangkok Post

Business leaders have expressed concerns that the rapidly appreciating baht could dampen exports and suggest business operators hedge foreign exchange risks.

SWIFT: Virtual Currencies Unlikely to Crowd out Fiat Currencies, According to New Research – CPI Financial

The SWIFT Institute has published a new research paper analysing whether Bitcoin will crowd out fiat currencies in the global community.

Market Savvy

UK Services Offer a Fresh Shot in the Arm for the Pound – Financial Times (subscription)

Another shot of better than expected data from the UK economy put the wind in sterling’s sails on Monday after the services sector recorded its biggest monthly jump in 20 years, defying expectations of a further leg lower for a currency now trading at a seven-week high.

Yuan Nears Six-Year Low as Bears Seen Testing PBOC Tolerance – Bloomberg

China’s currency fell toward a six-year low as yuan bears were seen testing the central bank’s tolerance for a weaker currency.

·      Libor Surge Reverberates All the Way to China’s Currency Market – Bloomberg 

FX-Profit-Taking Weighs on Asia FX; Baht Near One-Month Low – Reuters

Most emerging Asian currencies eased on Tuesday as investors booked profits from gains in the previous session with the US Federal Reserve seen raising interest rates later this year.

Japan Signals BOJ Won’t Adopt Foreign-Bond Purchases – Bloomberg

While Bank of Japan Governor Haruhiko Kuroda has indicated an openness to new ideas, at least one measure – buying foreign bonds – appears to be off the table as the central bank explores its options for monetary stimulus.