Regulators Should Scale Back Rules to Improve Liquidity Conditions

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Thomson Reuters Joins FXPA
The Foreign Exchange Professionals Association (FXPA) is pleased to announce the addition of Thomson Reuters as a Full Member. “As a leading independent provider of FX transaction venues, Thomson Reuters actively supports cross-industry initiatives such as FXPA to ensure a sound, liquid, transparent and competitive FX market. Now more than ever, transparency and fairness are values that need to be upheld by everyone in the FX industry. Working closely with the FXPA group, Thomson Reuters will continue its work to help the industry raise standards across all areas of the market,” says Phil Weisberg, global head of FX, Thomson Reuters. The addition of Thomson Reuters brings to 23 the number of institutional members now part of FXPA. To find out how you can support the FX industry through education, research and advocacy, visit our website at www.fxpa.wpengine.com, become an institutional member, and sign up for our newsletter, FXPA globalFXsource.

Regulators Should Scale Back Rules to Improve Liquidity Conditions – Profit & Loss (subscription)
Too many people view the last year or so as being an outlier when it comes to market volatility, when in reality it can just as easily be argued that it was actually the previous seven years that were the problem. The growing issue of sporadic liquidity, which is concerning some in authority, is a direct reflection of regulation imposed by their peers – and in some cases by their own organisations.

Extradition Hearing of Flash Crash Trader Sarao to Go Ahead on Friday – City AM
The British trader accused of triggering a so-called “flash crash” in US financial markets will have his extradition hearing on Friday. Navinder Singh Sarao, accused by the US Justice Department of causing the Dow Jones index to lose $800 billion in a matter of minutes, faces extradition on charges that carry a maximum sentence of 380 years.

Response to Banker Recklessness Needs Work: Lawyers – Operational Risk & Regulation (subscription)
The Serious Fraud Office will aim higher in the wake of the Tom Hayes conviction, but new laws could be difficult to enforce, senior London lawyers say.

Investors Slow to Adopt Libor Alternatives – Financial News (subscription)
Multimillion-dollar fines, a raft of lawsuits, a criminal conviction and the widespread belief that the benchmark is no longer fit for purpose might have prompted institutional investors to abandon the London inter-bank offered rate as their contractual reference point of choice. But seven years on from when a Wall Street Journal report first questioned the integrity of Libor, pension funds and other investors are proving remarkably slow in adopting alternatives.

Fund Managers Mull Trades in Choppy FX Markets – Euromoney
Volatility is back with a bang as traders seek to make sense of an uncertain global macroeconomic outlook. Fund managers lay out trading strategies drawing from CHF and CNY lessons, and one fears Japan and China are now in similar situations to Switzerland.

CFTC’s Giancarlo to Address P&L Forex Network Chicago on Thursday
J. Christopher Giancarlo, Commissioner at the US Commodity Futures Trading Commission, will be making the keynote address at the 13th Profit & Loss Forex Network Chicago conference on 24 September.

 

 

Regulatory News

FCA Beefs Up Enforcement Committee with Swathe of Big Hires – The Telegraph
The City watchdog has appointed 10 new members to its influential committees covering areas from competition to punishments, with lawyers, regulators and City representatives all being called up

Brussels Set to Recognise Another Five Overseas Clearing Regimes – Financial Times (subscription)
Europe is set to recognise five more countries as having “equivalent” rules to oversee clearing houses as Brussels steps up efforts to smooth cross-border activity in derivatives. The European Commission is set to vote in the coming week on applications by Switzerland, Mexico, Korea, Canada and South Africa.

Esma to Create Supervision Department – FOW (subscription)
The European Securities and Markets Authority (Esma) said it would reorganise its divisions from November as it looks to evolve from post­-crisis rule­making to implementation as part of its 2016-­2020 strategic plan.

CFTC Seeking Public Comment on a Petition by Japan Securities Clearing Corporation for Exemption from DCO Registration
The US Commodity Futures Trading Commission is asking for public comment on a petition by Japan Securities Clearing Corporation (JSCC) for exemption from registration as a derivatives clearing organisation.

CFTC and FDIC Lock Horns – International Financing Review (subscription)
Staffers at the Commodity Futures Trading Commission are considering ways to attract new entrants to the derivatives clearing business as concerns mount that the market may not get the capital reprieve on margin held against cleared trades that it has come to expect.

US Looking at Chicago Trader as Probe Over Fake Orders Widens – Bloomberg
Federal prosecutors are investigating whether a Chicago trader placed fake orders in an attempt to manipulate prices, said two people familiar with the matter, as the Justice Department broadens its effort to police the $30 trillion US futures market.

Progress Report on the CCP Workplan – Financial Stability Board
The FSB, CPMI, IOSCO and BCBS agreed a workplan to coordinate their respective international policy work aimed at enhancing the resilience, recovery planning and resolvability of CCPs, and to work in close collaboration. The agreed workplan focuses on CCPs that are systemic across multiple jurisdictions. This report provides an update against the agreed workplan.

 

 

Company News

A Different Journey: The New JP Morgan Markets – Profit & Loss (subscription)
JP Morgan’s rejuvenated single dealer offering is nearing completion, but the journey to this point has taken a different course to most offerings.

P&L Talk Series with Campbell Adams, ParFX – Profit & Loss
On the five-year anniversary of the launch of the FX Pure project, Profit & Loss talks to Campbell Adams, who founded the project and is now head of market at ParFX, about changing FX market behaviour and its impact on liquidity.

LCH.Clearnet Confirms 2016 for OTC FX Options – FX Week (subscription)
After several years of planning and developing, LCH.Clearnet has confirmed it will launch an over-the-counter FX options clearing service in 2016, which will be available via its ForexClear platform, pending regulatory approval.

China Europe Eyes November Launch Date – FOW (subscription)
The China Europe International Exchange (CEINEX), a joint venture between Deutsche Boerse, the Shanghai Stock Exchange and the China Financial Futures Exchange, will launch in November with a remit of supporting the internationalisation of the Chinese currency.

BATS Launches London FX Matching Engine – Profit & Loss
Hotspot,  the FX platform owned and operated by BATS Global Markets, says its new London-area matching engine, launched 14 September, traded $1.2 billion (single-count) in the first full week of operation.

Saxo Bank Co-CEO to Step Down from Board – Financial Times (subscription)
Lars Seier Christensen, one of the founders of Danish online trading company Saxo Bank, is stepping down from the board. Fellow co-founder Kim Fournais will stay on as the sole CEO.

Nordic Firm to Challenge Terminal Giants in London – The Trade
A Nordic market data provider said it wants to take on industry giants Thomson Reuters and Bloomberg to provide trading terminals to buy- and sell-side firms. Norway-based Infront said it is already providing its terminals to thousands of professionals in the Nordic region and Is now opening a London office.

 

 

Market Savvy  

China Worries Push Brazil’s Currency Close to All-Time Low – Financial Times (subscription)
The Brazilian real moved to within a fraction of its all-time low on Monday as investors worried about a deepening recession in Latin America’s biggest economy and the outlook for China.

US Dollar on the Front Foot as a 2015 Fed Rate Hike ‘Is Still Operative’ – Irish Independent
Sterling initially consolidated against the US dollar yesterday having gained 2% versus the greenback over the course of the previous fortnight as investors pushed back their expectations of when the US Federal Reserve will raise interest rates for the first time in almost a decade.

Greece’s Tsipras May Form Cabinet without Tsakalotos as Finance Minister – Reuters
Newly sworn-in Greek Prime Minister Alexis Tsipras is hoping to re-appoint Euclid Tsakalotos as his  finance minister on Tuesday but is struggling to persuade him to stay on in his post.

 

 

Press Releases

DTCC Appoints Mark Wetjen to Lead The Firm’s Global Public Policy Activities
The Depository Trust & Clearing Corporation (DTCC), the post-trade market infrastructure for the global financial services industry, has appointed Mark Wetjen as managing director with responsibility for leading the firm’s global public policy function and related business and legal activities.

ESMA Updates List of Authorised CCPs – CME Clearing Europe Extends Services
The European Securities and Markets Authority has published an update of its list of central clearinghouses which are authorised under the European Markets Infrastructure Regulation (Emir). The update concerns CME Clearing Europe which has been authorised to extend its activities and services to clear short term interest rate futures (Stirs) and deliverable swap futures.

 

 

Industry Events