Top Headlines

Moscow Exchange Joins FXPA
The Foreign Exchange Professionals Association (FXPA) is pleased to announce the addition of the Moscow Exchange (MOEX) as a Full Member of the FX trade association. “The Moscow Exchange is extremely honoured to have joined the Foreign Exchange Professionals Association. The FX industry is going through profound changes at present and we believe through the single voice and leadership of the FXPA we can build a better, more stable and more transparent market structure that will benefit all participants in the market,” says Igor Marich, Managing Director, FX & Money Markets at Moscow Exchange. The addition of MOEX brings to 22 the number of institutional members now part of FXPA, following the recent additions of EBS-BrokerTec and State Street Global Markets. To find out how you can support the FX industry through education, research and advocacy, visit our website at www.fxpa.org, become an institutional member, and sign up for our newsletter, FXPA globalFXsource.

Global Regulators to Meet in London, Fix Rules After Rigging Scandals – Reuters
Global regulators meet in London next month to try to tighten their grip on markets after banks were fined billions of dollars for manipulating interest rates and currencies, Britain’s top financial supervisor said.

MP Calls for New Report on BoE Handling of FX Scandal – Reuters
An MP has called for a new look into the Bank of England’s role in a foreign exchange scandal, saying the original investigation it commissioned was too narrow in focus.

UK Market Review to Push for Tougher Sentences – Financial Times (subscription)
A review by UK policy makers is to conclude that the ban on equity-market manipulation should be extended to other areas of trading such as foreign exchange, highlighting regulators’ increasing willingness to confront wrongdoing in the City.

The FX Fines: What Next for the Banks? – Profit & Loss (subscription)
With the fines announced last week bringing the total amount paid by the banks in relation to the recent FX investigations to over $10 billion, both these institutions and the regulators are facing questions about how they will prevent history repeating itself.

Good Times Fade Away: Compliance Holds Sway in FX Trading – Financial Times (subscription)
After $10 billion in fines for misconduct, multiple releases of humiliating staff transcripts and scores of ruined careers, the currencies trading industry has decided it is time to grow up.

What Does the Future Hold for FX Clearing? – The Trade
Many had been expecting the move to make enforce the mandatory clearing of non-deliverable forwards to be a fait accompli for 2015. Far from it. The announcement from the European Securities and Markets Authority (ESMA) also puts into doubt the Commodity Futures Trading Commission’s likelihood of implementing central clearing in the US, at a time when FX markets have seen huge volatility and volumes.

G7 Finance Ministers to Discuss Recent FX Moves – Reuters
Finance ministers and central bankers from the Group of Seven industrialised nations will discuss recent foreign exchange movements when they meet in Germany this week.

Dealers Under Strain as Corporate Use of Derivatives Increases – Profit & Loss (free story)
Corporates’ use of derivatives has increased by half since before the global financial crisis, with the annual interest rate derivatives trading volume of a typical big corporate user growing to $3 billion in 2014 from $2 billion in 2006, according to research by Greenwich Associates.

 

 

Regulatory News

US Senator Warren Calls for Hearings into Bank Waivers – Financial Times (subscription)
US Senator Elizabeth Warren and other lawmakers are calling for public hearings on whether banks accused of rigging foreign exchange markets should be allowed to manage retirement accounts.

In Britain, Libor-Rigging Conspiracy Case Is Also a Test for Regulators – New York Times
Banks have paid billions. Regulators and prosecutors have extracted guilty pleas from financial institutions. Dozens of employees have been fired, and at least one chief executive has lost his job. Now, on Tuesday, the first trader in the sprawling, half-decade-old investigation into the rigging of global benchmark interest rates will go on trial in Southwark Crown Court.

New York Soon to Unveil Fresh Bitcoin Licensing Rules – Wall Street Journal (subscription)
In one of his final moves as New York’s top financial regulator, Benjamin M. Lawsky will soon unveil a set of new licensing rules that could have long-lasting effects on businesses using bitcoin and other virtual currencies.

Bank of England Under Pressure to Publish Planned Brexit Risks Report – The Guardian
The head of an influential parliamentary committee has demanded the Bank of England publish its secret probe into the impact of an EU referendum, warning that it should expect a thorough examination of the report by MPs.

Mifid II a ‘Deal Killer’ for Some Swaps, Corporates Warn – Risk Magazine (subscription)
European corporates are warning that draft rules limiting the ability for banks to offer client-specific prices will be a “deal killer” for some swaps, and say they will probably avoid banks that are unable to give them a better deal.

FCA Fines Set to Dip Below Record Despite Libor and FX Penalties – The Independent
The Financial Conduct Authority’s income from fines is set to fall short of a record for the first time since 2011, despite announcing two of the three biggest penalties ever imposed on financial firms operating in Britain within the past month.

Banks Must Try Harder to Improve Conduct Next Term – Financial News (subscription)
What are investment banks’ report cards going to look like when they break up for the summer holidays this year?

 

 

Company News

Hong Kong CCP to be First to Clear Cross-Currency Swaps – Asia Risk (subscription)
OTC Clear will be the first central counterparty to clear cross-currency swaps, as early as year-end, according to Calvin Tai, head of global clearing at Hong Kong Exchanges and Clearing. OTC Clear started operations to clear over-the-counter derivatives in June 2014 focusing on products including interest rate swaps and non-deliverable forwards principally in Chinese yuan – both onshore (CNY) and offshore (CNH).

Saxo Bank Pursues 12 Singapore Clients Following CHF Chaos – Profit & Loss (free story)
Danish broker Saxo Bank has taken legal action against 12 clients in Singapore for losses sustained following the Swiss National Bank’s sudden decision to remove its long-held EURCHF floor on 15 January.

Citigroup to Sell Foreign Exchange Accounts to Saxo Bank, FXCM – Bloomberg
Citigroup will sell the Asia Pacific client book of its foreign exchange trading business, CitiFX Pro, to Denmark-based Saxo Bank.

Thomson Reuters April FX Volumes Rise Y-o-Y – Profit & Loss (free story)
Combined FX trading volumes on Thomson Reuters’ Matching and FXall platforms rose 5% year-on-year in April despite tailing off from the previous month’s average daily volume (ADV).

JP Morgan’s Guilty Plea Puts Wealth Unit in Spot with Regulators – Bloomberg
JP Morgan put allegations of currency fixing largely behind it with a guilty plea, but it’s not out of the woods yet. With its new felony record, America’s biggest bank needs to seek the Department of Labor’s permission to keep managing money in the $8 trillion private pension market.

Trading Tech Vendor ORE Extends Fenics FX Data Deal – Waters Technology
London-based ORE Tech, a provider of trading technology for the over-the-counter FX, metals and commodities markets, has renewed and extended a deal to use interdealer broker GFI’s Fenics analytics software suite to inform risk and quantitative modelling for users of its options trading platforms.

Icap’s New EBS and BrokerTec Brand – Profit & Loss (free story)
Icap’s electronic FX and fixed income business, EBS BrokerTec, says that it has made significant progress in combining its business operations as it launches a new brand and website.

 

 

Market Savvy  

Rebounding US Dollar Crucial for Central Banks
Financial Times (subscription)
Many central banks around the world are watching whether the US dollar can regain momentum and help stimulate their slowing economies via a powerful stimulus tool – currency depreciation.

IMF: China’s Yuan Currency is ‘No Longer Undervalued’
Business Insider
China’s yuan currency, which Washington has long alleged was manipulated, is “no longer undervalued”, the International Monetary Fund said Tuesday.

 

 

Press Releases

LCH.Clearnet Launches Buy Side Clearing of FX Derivatives in Europe
LCH.Clearnet, the global clearing house, has announced that ForexClear has extended its client clearing offering to include European model account structures. End-users trading non-deliverable forwards are now able to connect to four clearing brokers offering the service, including HSBC, Société Générale and Standard Chartered Bank.

Electronic FX Market Update, 2015: The Race Tightens Up – Aite Group
E-FX market fragmentation will remain as exchanges take greater interest in OTC FX and banks relinquish their market-making role.

 

 

Industry Events