Powell Prepares to Launch Pivotal Interest Rate Cut – Financial Times

Jay Powell is this week widely expected to announce the first cut in US interest rates for more than a decade, as the Federal Reserve chairman seeks an insurance policy against a weakening global outlook and rising trade tensions.

Trump Adviser Says Currency Intervention Off the Table; Trump Less Clear – Reuters

The Trump administration has “ruled out” intervening in markets to lower the U.S. dollar’s value, even though President Donald Trump is concerned other countries are weakening their currencies to gain a trade advantage, a top White House adviser said on Friday.

In the FICC of It (podcast) – Profit & Loss

In this week’s edition buy side adoption of the FX Global Code, questions arising from the latest FX turnover surveys and the continuing saga of non-bank market makers’ search for a new prime broker are on the agenda.

ECB’s Nowotny Predicts Historically Low Interest Rates in Long Term – Reuters

European Central Bank policymaker Ewald Nowotny said he expects interest rates to be lower in the long term than they have been historically.

Johnson Vows No‑Deal Brexit ‘By Any Means Necessary’ – The Times

Boris Johnson has set up a “war cabinet” to deliver Brexit “by any means necessary” by October 31 as a senior cabinet minister warned that there was “now a very real prospect” of no deal.

Sleepwalking Toward a Currency War – Dallas News

Nobody can know with any degree of certainty whether we are headed soon to a destructive world currency war in which countries compete to weaken their exchange rates to gain an unfair competitive advantage.

Global Policy Adjusts to the Surprising Effects of Trade Wars – Financial Times

China was expected to be the main casualty but that has not been the case so far.

US-China Trade Talks Collapse was ‘Not Normal’: Veteran US Negotiator – South China Morning Post

The dramatic collapse in US-China talks in May suggested that Chinese negotiators did not have full political backing for the concessions they proposed to reach a deal to end the trade war, according to a veteran US trade official ahead of the resumption of face-to-face negotiations this week in Shanghai.

Regulatory News

Five Banks Face Civil Lawsuit in London Over Forex Dealing – Financial Times

The European version of a class-action lawsuit that resulted in $2.3bn of settlements in the US is being filed in London on Monday, as lawyers move to bring a civil case against five banks claiming that dealers manipulated foreign exchange markets and caused investors significant losses on currency trades.

16 Big Banks Want Opt-Outs’ Forex-Rigging Suit Dismissed – Law360

A group of 16 major international banks have asked a New York federal judge to dismiss a sprawling lawsuit from nearly 1,300 investment firms and government entities who opted out of a settlement.

China Will Pursue Forex Reserves Diversification in Prudent Way – Reuters

China will pursue the diversification of its foreign exchange reserves in a steady, prudent way, the country’s foreign exchange regulator said on Sunday as it for the first time released some broad data on its reserve holdings.

EU Decision on Equivalence Set to Heighten UK Post-Brexit Fears – Financial Times

Brussels will this week strip five countries of some market access rights, in a move set to heighten British fears that the system the City of London will rely on to serve EU customers after Brexit fails to offer a stable and permanent regime because it can be withdrawn.

Crypto News

Despite Trump’s Anti-Crypto Tweets, the IRS Wants its Cut of Virtual Currency Profits –Mashable

Cryptocurrency might be a challenge to the primacy of the U.S. dollar, but that’s not stopping the Internal Revenue Service from wanting a piece of the action.

Mt. Gox Founder Can’t Escape Consumer Fraud Class Action – Law360

A federal judge in Philadelphia ruled Friday that the founder of bitcoin exchange Mt. Gox can’t escape class action fraud claims filed in his court.

Libra, Another Cryptocurrency War or a Future De Facto International Currency? – Econpapers

At the announcement of the launch of libra, Facebook’s new currency, planned for 2020 in a dozen countries, the current crypto-currencies have suddenly unscrewed. Can the banking market extend to new customers? Libra, poor man’s currency or money laundering vector?

Facebook’s Libra and the Scourge of Hot Money – Australian Financial Review

Facebook’s proposed cryptocurrency, Libra, would make it a lot easier for hot money to move around the world.

Crypto Exchanges are Benefiting from Algorithmic Trading – Coin Desk

Recently CoinDesk published an article titled, ‘High Frequency Trading is Newest Battle Ground in Crypto Exchange Race’ that discusses trading venues offering direct connectivity to their matching engines.

Company News

London Stock Exchange Confirms $27bn Refinitiv Takeover Talks – Financial Times

The London Stock Exchange Group has confirmed that it is in advanced talks to buy Refinitiv in a $27bn deal that would turn it into a global exchanges and data powerhouse.

LMAX Reports Strong H1 Results – Profit & Loss

LMAX Exchange Group has reported strong revenue growth and increased volumes across its platforms achieving record first half results.

Deutsche Bank Probes Access of Fired Workers to Systems – Financial Times

Deutsche Bank has launched an investigation into whether confidential client data were compromised after it failed to deactivate the accounts of dozens of fired staff when it closed its global equities business earlier this month.

First Derivatives Founder Conlan Dies – Profit & Loss

First Derivatives’ founder and CEO Brian Conlan has died, it has been announced, after being diagnosed with cancer earlier this year.

Market Savvy

Currency Baskets Have Their Advantages but Gold is Still Superior – Eurasia Future

During the lengthy discussions which led to the 1944 Bretton Woods Agreement, economist John Maynard Keynes opposed fixed exchange rates via-a-vis a gold backed US dollar. 

Why Do Currency Crises Recur? – Ideas

Argentina and Turkey experienced currency crises in 2018, having also had crises in 2001. Why do crises recur? 

A Key Reason the Fed Struggles to Hit 2% Inflation: Uncooperative Prices – Wall Street Journal

One reason the Federal Reserve is likely to cut interest rates this week is that inflation is running below its 2% target and new research shows why getting it higher has proved so difficult.

RBA Could Cut Again in August – Australian Financial ReviewFutures markets are suggesting the Reserve Bank of Australia will cut the cash rate twice more in the next 12 months, with the next cut potentially coming as soon as next week.