Markets Urge Regulators to Fix Data Confusion

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Top Headlines

Markets Urge Regulators to Fix Data Confusion – Financial Times(subscription)
In a rare display of unity, banks, futures brokers, hedge funds and asset managers have joined together to urge global regulators to resolve the growing chaos around reporting requirements for trades.

FEMR: London Can’t Go it Alone in Regulatory Reform – Profit & Loss(subscription)
FEMR remains the subject of discussion and in fact I do want to delve a little further into its potential impact. Clearly, especially when it comes to foreign exchange markets, London is the pre-eminent financial centre, but amidst all the discussion about what is an important document it is important to remember that the UK cannot and will not be the driver of reform in FX markets.

Financial World Can Turn its Back on the Crisis – Financial Times(subscription)
It is notoriously hard to judge history as it is unfolding. But a decade from now, financiers may look back and conclude that June 2015, some eight years after the start of the financial crisis, marked a turning point for the banking industry and how it is perceived by society.

Greece Isn’t Going to Become the Next Zimbabwe, Not Even the Next Venezuela – Forbes
The Greek situation isn’t looking good for those who hope for a deal which leaves Greece both inside the euro and also able to deal with its mountain of debt. However, it’s all a bit much to then decide that Greece will thus be condemned to become the sort of howling wasteland of an economy that Zimbabwe represents.

Ex-BlackRock Foster: Over-Engineered CCPs Will Open Space for Newcomers – Profit & Loss (free story)
Central counterparties (CCPs) are completely “over-engineered, becoming extremely costly and not in the best interest of investors” in Europe and the US, according to Nigel Foster, former head of the trading and liquidity strategies group in Europe, the Middle East and Africa at BlackRock.

Bank Withdrawal From 4pm Fix Heightening Volatility – Profit & Loss (free story)
Speaking at Profit & Loss’ Forex Network New York conference Andrew Maack, head of FX trading at Vanguard, said that he believed that the changes to the WMR Fix methodology have overall been positive, but that the 4pm window has become more volatile to trade in since it was expanded from one minute to five.

IMF Team in China as Part of Currency Basket Review – Reuters
A team from the International Monetary Fund is visiting China as part of the global lender’s review over whether to include the Chinese yuan in its basket of currencies, an IMF official said on Friday.

Regulatory News

Corley: Asset Managers Should Get Used to Regulatory Glare – Financial News (subscription)
Asset managers must get used to increased scrutiny by regulators, one of the industry’s leading executives said after becoming head of a body set up in response to scandals in fixed income, currency and commodity markets.

CFTC Re-Authorisation Bill Looks to Curb Agency’s Power – Profit & Loss(free story)
The US House of Representative has passed legislation to re-authorise funding for the Commodity Futures Trading Commission (CFTC), but included provisions that curb the regulator’s power.

RMB Capital Account Convertibility in Near Sight: PBOC – Want China Times
China is near its goal of a fully convertible renminbi, after nearly a decade of effort, the Chinese central bank said on Thursday. “China has been steadily pushing forward renminbi capital account convertibility since the currency became convertible under the current account in 1996,” the central bank said in a report released on its website.

Company News

State Street Launches its First Currency Hedged ETF – Profit & Loss (free story)
State Street Global Advisors (SSGA), the asset management business of State Street Corporation, has launched its first currency hedged Exchange Traded Fund (ETF), the SPDR Euro STOXX 50 (HFEZ).

FXCM, Gain See Institutional Volumes Fall M-o-M – Profit & Loss (free story)
FXCM has reported institutional client trading volume of $206 billion in May. While this was 6% lower than April’s volume, it was 11% higher than in May 2014 and mirrors results from other institutional trading platforms.

Market Savvy  

Bearish Euro Bets at 2015 Low Show Traders Less Fazed by Greece
Bloomberg
As Greece enters a potentially make-or-break week in its debt negotiations, currency investors appear remarkably unfazed by the prospect of a default.

Hardy: As the Fed Meets This week, What to Expect in FX
Saxo Bank
It’s a big week ahead for central banks, with the Fed meeting on Tuesday and Wednesday. Saxo’s John Hardy says as well as releasing its new monetary policy statement, it will also publish its economic projections as well as where members expect policy to go after 2017. The market will also be watching for language that could hint at when a future rate rise could be.

Market Participants Brace for Volatile Week
LMAX Exchange
The FX market opens the week locked in choppy consolidation, though there is an expectation the directionless trade will come to an end in the days ahead. Participants have been waiting for more clarity from the Fed on the rate lift-off timeline and will get it on Wednesday, with the FOMC decision due.

Press Releases

Industry Associations Endorse ISDA Data Reporting Principles
A group of 11 industry Associations has published a letter supporting a set of principles developed by the International Swaps and Derivatives Association (ISDA) aimed at improving consistency in regulatory reporting standards for derivatives.

EBA Supports the Removal of the DKK from the ITS on Currencies with Constraints on the Availability of Liquid Assets
The European Banking Authority (EBA) issued an opinion to the European Commission supporting its proposed amendments to the EBA final draft ITS on currencies featuring constraints on the availability of liquid assets. The EBA agrees with removing from its ITS the Danish krone (DKK) as a currency for which there are insufficient liquid assets and supports the amendments to the recitals that justify why the Norwegian krone (NOK) still qualifies as a currency with such constraints.

Industry Events