Top Headlines

Markets Start 2017 on Bright Note – Financial Times (subscription)

Markets are in an upbeat mood for the first session of 2017, looking to revive the post-US election rally that took Wall Street and London stocks to record levels and forced government bond yields to multi-month peaks toward the end of last year.

China’s Yuan May See More Volatility Vs Dollar After Basket Change – Reuters

China’s yuan is likely to see more volatility against the US dollar this year after its foreign exchange market operator changed the way it calculates a key yuan index by nearly doubling the number of foreign currencies in its basket. 

China’s New Rules on Yuan Transfers Are Not Capital Controls – Reuters

China’s new rules on overseas currency transfers are not capital controls, the official Xinhua news agency reported, even as some banks told customers that purchases of foreign currency for property, securities and life insurance were not allowed.

US House Financial Services Committee Member to Address SEFCON VII – Profit & Loss

Rep. Bill Huizenga (R-MI) will speak at SEFCON VII, the premier swaps industry conference, which will take place just two days before Inauguration Day, on January 18 at The Roosevelt in NYC. 

Positives for Platforms in December Data – Profit & Loss

The first three platforms providers to report December average daily volume data have experienced the expected slowdown in December from November, but have lifted year-on-year.

London Stock Exchange to Sell French Arm of LCH to Euronext for $534 Million – Wall Street Journal (subscription)

Sale could help alleviate competition concerns about LSE’s planned merger with Deutsche Börse.

Dollar Recovers from Two-Week Lows in Holiday-Thinned Market – Reuters

The dollar recovered from a two-week low against a basket of six major currencies, though trade was thin due to many markets being closed for the New Year holiday.

Re-Energized Dollar Looms Over the Rest of the World – Wall Street Journal (subscription)

On Wall Street, the rising dollar has been one of the most visible signals of growing optimism in the US economy; for many other countries, it spells trouble.

Turkish Lira Hits Fresh Record Low After Istanbul Attack – Financial Times (subscription)

The Turkish lira hit yet another record low, falling to 3.60 per dollar on markets’ first full day of trading since Sunday morning’s terror attack in Istanbul.

Bitcoin Was the Best-Performing Currency of 2016 – Science Alert

The world’s most high-profile digital currency, bitcoin, hit a three-year high this week, rising above US$1,000 in a strong surge that saw it stand out as the best-performing currency of 2016.

Open Up India’s Debt Market to Curb FS Volatility – DNA India

Inclusion of government debt in global indices will bring in stability.

Political Risk Remains Big Driver of Currency Sentiment – Financial Times (subscription)

Questions loom over scope for further gains in the dollar and pound.

Financial Markets: 2016 in Charts – Financial Times (subscription)

Ascent of Trump caps a year marked by big fluctuations for asset prices.

Regulatory News 

Countdown Begins for Europe’s MiFID II – Financial News (subscription)

With just 12 months left until the introduction of a new rulebook that will transform Europe’s trading landscape, many of the regulations remain clouded in uncertainty, according to market participants.

Dealers Increasingly Route Derivatives to Clearinghouses, Survey Says – Wall Street Journal (subscription)

Fed says increase due to more types of clearing-eligible products and better prices for cleared transactions.

EU Seeks to End Anonymity of Bitcoin Users, Proposes Amendments – Econo Times

The European Parliament and the Council of the European Union have proposed amending a directive on the prevention of the use of the financial system for the purposes of money laundering or terrorist financing.

Myanmar Eyes Junta’s Old Tricks to Fight Weaker Currency – Nikkei Asian Review

Desperate to halt the severe depreciation of its national currency, Myanmar’s democratically elected government may revive drastic measures that were employed by the military junta.

Rouhani Pledges to Reverse Slide of Iran’s Currency – Reuters

President Hassan Rouhani sought to reassure Iranians that the government would work to protect market stability after the country’s currency fell to a record low last week.

Company News

FastMatch Adjusts Fees for 2017 – Profit & Loss

FastMatch is making a number of changes to its fee schedule, effective February 1, 2017.

Jain Joins Cantor – Profit & Loss

Jain stepped down from the role of co-CEO of Deutsche Bank in mid-2015 as concerns grew over the bank’s financial health and a series of regulatory missteps.

Goldman Sees Indonesia Less Vulnerable to Sell-Off Than 2013 – Bloomberg

Indonesia is better placed to tackle any currency volatility and capital outflows triggered by higher US interest rates than during the taper tantrum in 2013, according to Goldman Sachs Group.

Falling Yuan to Trigger Turmoil in Global Markets – Financial Review

China’s currency is set to fall sharply in 2017, triggering turmoil in global equity markets and causing huge pain for commodity-dependent countries such as Australia, according to leading Beijing-based research analyst, Anne Stevenson-Yang.

Compliance and Risk Aversion Will Dominate in 2017 – FX Week (subscription)

Thomson Reuters is building a set of next-generation solutions for customers less willing to tolerate risk amid cost pressures.

Market Savvy

British Pound Poised to Punch Higher Against Australian Dollar – Pound Sterling Live

The pound to Australian dollar exchange rate finds itself back at a familiar level as the new trading year starts.

Currencies Range-Bound, Investors Assess Strong Polish, Czech PMI – Reuters

Central European currencies opened the new year a touch weaker in thin trading, unfazed by strong December purchasing manager indices.

Kenyan Shilling Seen Steady, Nigeria’s Naira Could Weaken – Business Recorder

Kenya’s shilling and Zambia’s kwacha are seen holding steady against the dollar in the next week to Thursday, while Nigeria’s naira will likely weaken, traders said.

Rupee Recovers 14 Paise in Early Trade – The Hindu

Rupee recovered by 14 paise to 68.08 against the dollar at the interbank foreign exchange on fresh selling of the US currency by banks and exporters.

Press Releases

Finalising Basel III reforms – BIS

The Group of Central Bank Governors and Heads of Supervision (GHOS), the oversight body of the Basel Committee on Banking Supervision, welcomes the progress made towards completing the Basel Committee’s post-crisis regulatory reforms.