Top Headlines

Mexican Peso Soars as Trump Orders Border Wall – Wall Street Journal (subscription)

The Mexican peso surged more than 2% against the US dollar, confounding many traders, after President Donald Trump signed orders to build a wall on the Mexican border and clamp down on immigration.

Mexican Peso: Time to Pile In? – Financial Times (subscription)

To say that the Mexican peso has been the punching bag of choice for investors would be an understatement.

Dollar Sinks to Ten-Week Low After Trump Calls for Voter Fraud Investigation – Financial Times (subscription)

The US dollar has taken a fresh lurch lower, slumping to its lowest level since November after US president Donald Trump announced he will launch a “major” investigation into potential voter fraud.

Powerful Forces Will Lead to a Strong Dollar Under Trump – Financial Times (subscription)

The US president fails to see that his policy plans will drive the exchange rate up.

UBS Says Dollar to ‘Roll Over’ Amid Trump Spending, Tax Cuts – Bloomberg

The dollar has peaked and will probably decline this year under President Donald Trump, according to UBS Group’s wealth-management unit, which expects the currency’s impending weakness will help to benefit prices of base and precious metals.

Pound Stays Close to Six-Week High After Economic Growth Data – Financial Times (subscription)

Sterling held on to most of it recent gains, but better than expected economic growth figures failed give the currency any further momentum.

Pound Risks Becoming Irrelevant as Brexit Dims Reserve Status – Bloomberg

The fallout from the UK’s vote to exit the European Union includes the risk of the pound losing favor as a place for safe-keeping by global managers and their $11 trillion stockpile of reserves.

Renminbi in Retreat as International Payment Currency – Financial Times (subscription)

Swift data show drop of 30% last year as capital controls and dollar strength bite.

A Return to Unorthodoxy: Welcoming Turkey’s Latest Interest Rate Move – Financial Times (subscription)

Turkey’s lira didn’t know if it was coming or going in the wake of the latest interest rates decision, where the central bank kept its benchmark rate unchanged but tightened up on its overnight lending rate.

Russia to Begin Buying Foreign Currency from February – Financial Times (subscription)

Russia says it will start buying up foreign currency from February in an attempt to shield the rouble from volatility.

The Return of Risk in FX – Profit & Loss

Are systematic traders about to have a very bad three or four years?

Regulatory News

FIA Calls for Wholesale Review of Financial Regulation – Profit & Loss

The head of the Futures Industry Association (FIA), Walt Lukken, has issued an open letter to the US President, Donald Trump, requesting an immediate review of all financial reform regulation.

Lacking Leadership, US Financial Regulators Could Be in Slo-Mo for a While – Reuters

Wall Street firms waiting for President Donald Trump to usher in a new era of deregulation may have to wait a significant while longer.

Germany Calls Bankers to Frankfurt for Brexit Move Talks: Sources – Reuters

German regulators will meet more than 20 foreign banks on Monday to spell out requirements for moving some operations to Frankfurt, people familiar with the matter said, as the city accelerates plans to win over business from London after Brexit.

Fintechs Warned to Expect Tougher Regulation – Financial Times (subscription)

Bank of England’s Carney says disruptive technology could signal end to traditional bank model.

Financial Regulation: Wall Street Takes Washington – Wall Street Journal (subscription)

A new crowd of deregulating Wall Streeters take power in Washington under President Donald Trump, as they prepare to freeze, then undo, Obama-era rules.

How Safe Should the Financial System Be? – Wall Street Journal (subscription)

As US policy makers debate changes to financial regulatory policy, a senior Federal Reserve staffer says something is missing: clear instructions from Congress about how safe the US financial system needs to be.

Buy Side Wants Margin-Rule Delay – Markets Media

Counterparties will have to exchange variation margin for non-cleared over-the-counter derivatives from 1 March 2017.

Company News

BGC Brokers Partners with Pirum Systems for Post-Trade Connectivity – The Trade

BGC Brokers’ ColleX trading platform will integrate Pirum Systems’ tools.

Top Forecaster Says Fed to Increase Rates Every Quarter in 2018 – Bloomberg

The Federal Reserve is about to go rapid-fire on interest rates, boosting them in the second half of this year, and following that with a rise in every single quarter of 2018, according to BNP Paribas, which expects the tightening to strengthen the dollar and push gold down toward $1,000 an ounce.

Market Savvy

Emerging Stocks at Three-Month High, Rouble in Second Day of Losses – Reuters

Emerging stocks hit three-month highs, boosted by US shares roaring higher, but currencies weakened led by a fall in the rouble after Russian authorities announced steps to increase central bank reserves.

Rand Rally Wipes Out Post-US Election Losses – Financial Times (subscription)

The South African rand strengthened more than one per cent, bringing it close to 15-month highs as it recovers the last of the losses that hit emerging market currencies after the US election.

C$ Climbs to One-Week High as Trade Fears Abate – Reuters

The Canadian dollar strengthened to a one-week high against its US counterpart as investor fears of a more unfavorable trade outlook for Canada abated and the greenback suffered broader losses.