Top Headlines
Massad Officially Resigns as CFTC Chair – Profit & Loss
Timothy Massad has tendered his resignation as Chairman of the US Commodity Trading Commission (CFTC) to President Barack Obama, effective on January 20, 2017.
Pound Inches Up Against Weakened Dollar – Reuters
Sterling inched higher against a broadly weaker dollar after hitting a two-month low on a volatile first day of 2017 trading in London when Britain’s chief EU negotiator quit.
Dollar Edges Down From 14-Year High as Traders Await Cues – Reuters
The dollar edged down from a 14-year high against a basket of currencies, with investors cautious about increasing bets on the greenback before getting fresh clues on the US economy and timing of interest rate rises.
For Dollar Traders, the Most Important Signal Comes Roaring Back – Bloomberg
If you’re a dollar bull and you’re getting a little nervous about the sustainability of the greenback’s rip-roaring rally, take comfort in knowing that a fundamental gauge of the currency’s worth is on your side.
China Said to Consider Options to Back Yuan, Curb Outflows – Bloomberg
China has studied possible scenarios for the yuan and capital outflows this year and is preparing contingency plans, according to people familiar with the matter.
Mexico’s Peso Deepens Losses After Ford Scraps Mexican Plant Plan – Reuters
Mexico’s peso fell to touch its weakest level in seven weeks after Ford, the second-largest US automaker, said it will cancel a planned $1.6 billion factory in Mexico’s central state of San Luis Potosi.
Southeast Asia’s Worst-Performing Currency Is in for Another Tough Year – Bloomberg
Southeast Asia’s worst-performing currency of 2016 is in for another tough year with President Rodrigo Duterte’s spending plans seen boosting imports just as rising US interest rates spur capital outflows.
First Post-Brexit Currency Intervention Draws Denmark’s Red Line – Bloomberg
The world-record holder in negative rates conducted its first currency interventions since June, when Denmark was fighting back a flight to safety triggered by Britain’s vote to leave the European Union.
TP Icap’s Plan to Squeeze Brokers After Deal: Pay Less, Do More – Bloomberg
TP Icap has a straightforward strategy to increase profits after completing the $1.6-billion purchase of Icap’s broking business: paying brokers less for doing more.
Analytics, Best Execution and Clearing to Drive Trends in 2017 – FX Week (subscription)
Evaluation of liquidity is moving away from bank vs non-bank as clients gain more tools to assess execution behaviour.
What is Causing Flash Crashes? – Prospect Magazine
Flash crashes in financial markets are causing increasing consternation among central bankers, traders and indeed anyone who depends on the great many things that are priced by markets.
Bitcoin Digital Currency Hits Three-Year High of $1,000 – BBC
Digital currency Bitcoin has seen its value top $1,000 (£815) for the first time in three years after it ended as the best-performing currency of 2016.
Regulatory News
MiFID II to Cost Over €2.5bn – Markets Media
The financial industry will need to spend more than €2.5bn ($3bn) to comply with the MiFID II regulations, which come into force in the European Union in a year.
Global Bank Capital-Rule Revamp Postponed as Europe Digs In – Bloomberg
Global bank regulators pushed back a final decision on new capital standards as they struggle to reach an agreement in the face of strident European opposition.
Wall Street Lawyer Jay Clayton Emerges as Trump’s Top SEC Choice – Reuters
Wall Street lawyer Jay Clayton, who has worked on high-profile initial public offerings such as Alibaba Group, is a leading candidate to head the US Securities and Exchange Commission in the Trump administration, two sources familiar with the matter said.
Nigeria hopes to conclude the sale of a $1 billion Eurobond by the end of the first quarter of 2017 and will seek to make its foreign exchange market more flexible, said vice president Yemi Osinbajo.
Sri Lanka to Decriminalize Forex Transactions, Relax Exchange Controls – Economy Next
Sri Lanka will decriminalise foreign exchange transactions, replacing a draconian law that bans the use of foreign currency, which was brought when a money printing central bank started generating foreign exchange shortages after independence.
Company News
PB Concentration Risk a Concern as Volatility Picks Up – FX Week (subscription)
Global head of Currenex says the lack of a dynamic FXPB space is a worry as non-bank liquidity providers need access.
FXSpotStream’s December Volumes Retreat Off Previous Highs – Finance Magnates
FXSpotStream closed out the year strong, despite seeing a MoM decline of its ADV.
Asian Currencies Likely to Decline Ahead of US Inauguration Day, Says Scotiabank – Econo Times
Emerging market Asian currencies will continue to be primarily driven by the odds of Fed rate hikes that could change in response to US macro data, Fed comments/minutes and Donald Trump’s economic and fiscal policies.
Market Savvy
Emerging-Market Currencies Fall as Mexico Peso, Turkey Lira Sink – Bloomberg
Emerging-market currencies declined as Mexico’s peso and Turkey’s lira slumped to record lows.
Ringgit Drops to 19-Year Low Against Stronger Dollar – Reuters
The Malaysian ringgit briefly touched a 19-year low against the dollar, as the greenback continued to strengthen on expectations of further US interest rate hikes later this year.
Risk-On Tide Lifts Developing World to Commodities – Bloomberg
The dollar fell against higher-yielding peers and Asian stocks rose with commodities, as an optimistic start to 2017 spread to emerging-market currencies.
Press Releases
HKEX To Offer RMB Currency Options – HKEX
Hong Kong Exchanges and Clearing Limited (HKEX) plans to offer renminbi (RMB) currency options and is aiming to roll out a US dollar/offshore RMB contract in the first quarter of next year, subject to market readiness.