Regulators Eye Leverage Cap in FX – Euromoney
The convulsions after the SNB’s decision to cease pegging the Swiss franc to the euro are still being felt, with regulators in Europe and Australia debating the merits of tougher controls on leverage in FX markets for retail investors.
Financial Markets Becoming More Fragile, Says Bank of England – Wall Street Journal (subscription)
The Bank of England has joined a growing chorus of regulators and investors warning that global financial markets are becoming more “fragile” and prone to extreme convulsions. Recent trends, such as low trading volumes, “could lead to heightened volatility and undermine financial stability,”according to a statement from Tuesday’s meeting of the Bank’s Financial Policy Committee, which monitors financial market risks.
ECB Shelves Euro Clearinghouse Policy: Source – Reuters
The European Central Bank has quietly shelved its policy of requiring clearinghouses handling euro-denominated securities to be located inside the eurozone, after the measure was rejected by a top European court, a source at the central bank said.
Global Currency Trading Principles Said to Be Ready for Release – Bloomberg
Central banks in the world’s biggest currency markets will publish on Monday principles of behaviour and ethics for foreign exchange trading, according to a person familiar with the document.
Treasury Help Sought in Cross-Border Swaps Dispute – Wall Street Journal (subscription)
A fight threatens clearinghouses like CME and ICE as global regulators work to ensure equivalent rules. Senate Agriculture Committee Chairman Pat Roberts (R., Kansas) is pressing the Obama administration to help resolve a protracted cross-border dispute over the cross-border treatment of clearinghouses.
Wall Street Banks Bask in Warmer Trading Clime – Wall Street Journal (subscription)
The volume of trading in bonds, interest rate products, currencies, and commodities has been sharply higher in the first three months of 2015. This will likely mean improved trading revenues when the big market-making banks report results for the quarter coming to its close in just a few days.
Report: Buy Side Quest for Best Execution Fosters FX TCA – Profit & Loss
Buy-side market participants, such as corporate treasuries, public pension plans and private endowments, are increasingly embracing best execution philosophy for FX, as they begin treating it as a separate asset class and a source of alpha, in addition to actively hedging FX exposure on a regular basis, says Aite Group in a new report.
The Yuan Comes to Europe as LSE Hosts ETF Tracking Chinese Money – Bloomberg
A Chinese bank has launched the first money-market fund denominated in yuan that’s based in Europe, a milestone in the currency’s emergence as a major force in world markets.
Dealer Body Launches Good Behaviour Check for Banks – Reuters
Financial markets body the ACI launched a new online learning portal for dealers on Thursday. Its “Model Code” of dealer conduct is formally recognised by a number of central banks and was included in a joint document agreed by all of the major monetary authorities this month in an effort to unify conduct rules globally.
SNB Warns of ‘Difficult Times’ as Currency Move Hits Home – Financial Times (subscription)
Switzerland is facing “difficult times” and a short period of deflation following January’s abrupt unwinding of a currency peg, one of the Swiss National Bank’s most senior policy makers said on Thursday night.
Euro Falls for Second Day Versus Dollar as Post-Fed Rally Fades – Bloomberg
The euro fell for a second day against the dollar, after climbing to a three-week high on Thursday, amid speculation the US currency’s record rally will continue even after the Federal Reserve cut its outlook for interest rates.
Won Leads Asian Currency Advance This Week on Fed Rate Outlook – Bloomberg
Asian currencies climbed this week, led by South Korea’s won and Malaysia’s ringgit, on speculation the Federal Reserve will raise US interest rates at a slower pace than market participants had envisaged.