Top Headlines
Pound Sterling Hits New 31-Year-Low Ahead of Theresa May’s Brexit Speech – Independent
The currency slumped to more than a three-decade low, excluding the flash crash on 7 October.
- Pound Falls Below $1.20 Ahead of May’s Brexit Speech – Financial Times (subscription)
- Sterling Skids to Three-Month Low as ‘Hard Brexit’ Fears Bite – Reuters
- UK Pound Burdened by Brexit Fears – Wall Street Journal (subscription)
Sterling Options Signal More Turmoil as May Speech, Ruling Loom – Bloomberg
A measure of anticipated swings for the pound climbed to the highest in three months before UK Prime Minister Theresa May’s speech on Brexit plans Tuesday and a court ruling this month on whether the British leader or Parliament carries the power to invoke the exit.
Pound to Euro Exchange Rate to Fall to Par Say Deutsche Bank – Pound Sterling Live
Pound sterling was on offer at the start of the new week as the hard-Brexit story continues to be digested by foreign exchange markets.
What We Learned from the Sterling Flash Crash – Profit & Loss
The BIS report paints a picture of a quite different FX market to the one advertised in the brochures.
Trump Era, Brexit May Spur Year of Greater Currency Volatility – Bloomberg
Investors could end up paying higher premiums for hedging Brexit negotiations, euro area elections among risk events.
Trump’s Silence on Yen is ‘Amazing,’ Former Japan FX Head Says – Bloomberg
Donald Trump has repeatedly made waves with emphatic tweets and striking statements, but Japan’s former currency chief is more surprised about what the president-elect isn’t talking about: the yen.
Yuan Top Forecaster Sees No End to Losses as China Economy Slows – Bloomberg
Pressure on China’s yuan to depreciate will persist as the economy slows, according to the currency’s top forecaster.
China’s Currency Manipulation Could Become a Global Problem in 2017 – Business Insider
China is manipulating the yuan but with a twist.
Turkey Tightens Funding Taps to Support Lira – Reuters
Turkey’s central bank effectively closed off two of its lira funding taps, bankers said, in an apparent attempt to force banks to borrow at a higher rate and stabilise the currency after sharp falls.
Strong Dollar Steps in to Bolster Some Economies – Wall Street Journal (subscription)
US currency’s surge aids efforts to raise growth and spark inflation, goals that have proven difficult to achieve despite years of stimulus policies.
FX Trading in 2017: Plenty of Surprises to Come – Profit & Loss
Last year the FX market was highly event driven, with periods of sustained low volatility occasionally punctuated by large but episodic market moves.
Regulatory News
Dodd-Frank Act: Is Change Coming? – Profit & Loss
Bill Shields, chief compliance officer at GFI Swaps Exchange, talks to Profit & Loss about how swaps regulations could change in 2017.
Trump’s View on China’s Yuan Doesn’t ‘Fit With Reality’ – CNBC
Former Fed chief Ben Bernanke said that President-elect Donald Trump calling China a currency manipulator doesn’t “fit with reality” and warned about the dangers of a trade war.
‘Demand, Supply Imbalance Among Reason for Ringgit’s Decline’ – Malaysia Kini
Demand and supply imbalances in the domestic foreign exchange market intensified the pressure on the ringgit’s decline, said Bank Negara governor Muhammad Ibrahim.
SEC Warns Nigerians Against Investing in Bitcoins, Other Digital Currencies – Premium Times
Nigerians have been warned against investing in digital currencies such as Bitcoin, Swisscoin and OneCoin.
Israel Tax Authority Deems Bitcoin a Taxable Asset – Crypto Coins News
The Israeli Tax Authority has issued an official draft circular to clarify the tax guidelines that apply to bitcoin adopters.
Company News
Integral’s Case Against EBS BrokerTec CTO to Continue – Profit & Loss
The US Ninth Circuit Court of Appeals has overturned some of the decisions made by the US District Court regarding claims that EBS BrokerTec CTO, Viral Tolat, misappropriated trade secrets from his former employer, Integral Development Corp.
Named: The Best and Worst Funds of 2016 – Financial Times (subscription)
A BlackRock fund that aims to reduce currency risk for clients investing with sterling was named as the worst-performing fund globally last year.
El-Erian Says Buy Emerging-Market Currencies That Fell Too Much – Bloomberg
Mohamed El-Erian, Allianz SE’s chief economic adviser, said investors willing to withstand short-term price swings would do well to bet on a rebound of currencies outside the world’s largest economies.
Market Savvy
Asia FX Slip on Caution Before Fed Speakers, Trump Inauguration – Reuters
Asian currencies fell as investors awaited comments from Federal Reserve officials this week and Republican Donald Trump’s inauguration for clues on the outlook for US policies and the dollar.
Aussie Dollar Resilient in Afternoon Trade – The Australian
The Australian dollar was unchanged at mid-afternoon from its level against its US counterpart, but is proving to be among the most resilient major currencies so far in 2017 in the face of global jitters – most recently, those around the UK’s planned exit from the European Union.
A perfect storm is forming around the Malaysian ringgit, as its value remains at risk from a protracted economic slump aggravated by a domestic political scandal and the prospect of rising US interest rates.