Top Headlines

Rogue Chinese Renminbi Exchange Rate Raises Eyebrows – Financial Times (subscription)

Anyone checking the exchange rate between China’s renminbi and the US dollar would have got a shock early on Tuesday when an apparent glitch resulted in quotes shown on Google and at least two other currency exchange websites showing an eight per cent devaluation.

Onshore Renminbi Trading Stronger After Fix – Financial Times (subscription)

China’s currency is trading markedly stronger after the country’s central bank set its trading band against the dollar stronger. 

Trump’s Tweets Continue Currency Manipulation Speculation – Profit & Loss

Comments made by US president-elect Donald Trump on Twitter have sparked fresh speculation as to whether his administration will label China a currency manipulator once he is in office.

Euro Steady Near Three-Week High, Big Bets on Market Volatility – Reuters

The euro held steady near a three-week high while bets on market volatility stayed close to their highest since June’s Brexit vote ahead of this week’s European Central Bank meeting due to give new guidance on its quantitative easing programme.

British Pound’s Strength vs Euro and US Dollar to Fade Early in 2017 – Pound Sterling Live

Sterling trades with a positive bias as the short-squeeze higher in the euro that defined the markets following the Italian referendum fades.

Italian Referendum Could Spell Trouble for the Euro – Profit & Loss

The referendum decision in Italy to reject changes to the Italian constitution, and the subsequent resignation of Italian Prime Minister, Matteo Renzi, could spell trouble for the future of the euro, warn economic strategists.

Dollar Takes a Breather After Volatile Bout of Trading – Market Watch

The dollar was almost flat against its rival currencies in directionless trade, on the heels of wild, euro-driven gyrations.

The World’s New Fear Gauge is Ringing Alarm Bells in the Era of Trump – Bloomberg

Once upon a time, the cost to hedge currency risk in global trade and finance was relatively cheap. How things change.

Lira Overtakes Mexican Peso as Weakest EM Currency Since Start of November – Financial Times (subscription)

Friday was rough for the Turkish lira, and this morning is not looking any brighter, after Opec’s oil deal and some unwelcome political interventions helped it overtake the Mexican peso as the worst-performing emerging market currency over the last month.

Regulatory News

Biden Defends Dodd-Frank, Other Obama Financial-Regulation Policies – Wall Street Journal (subscription)

Vice president says the incoming Trump administration would be wise to examine existing agencies and regulations before trying to eliminate them.

Central Counterparties Should Be Non-Profits, Volcker Think Tank Says – Wall Street Journal (subscription)

Report recommends turning CCPs into ‘utilities’.

Weak Lira Could Knock Turkish Central Bank Off Targets in Early 2017 – Reuters

Weakness in the Turkish lira could start to drive up prices and knock the central bank off its targets in the first quarter of next year, but the impact will depend on the pace of economic activity, Governor Murat Cetinkaya said.

Bank Negara Malaysia Dealing with Short-Term Volatility of the Ringgit – The Nation

A slew of measures undertaken by Bank Negara Malaysia are expected to help enhance a continuous supply of foreign currency.

Fed Research Urges More Study of Fintech Links to Financial Markets – Wall Street Journal (subscription)

The Federal Reserve said the long-term impact of the technology behind bitcoin remains unclear, in a research paper examining the potential risks and rewards of such innovations on financial markets.

Company News 

FCA Proposed FX Restrictions Decimates CMC, IG and Plus500 Shares – Finance Magnates

Seconds after the open on the London Stock Exchange, shares of Plus500 tanked 40%, with peers underperforming. 

ICE Reports Solid Volumes Across FX and Commodities in November 2016 – Finance Magnates

ICE notched growth across its foreign exchange and credit volumes, which averaged 46,000 contracts per day.

Citi Moves Electronic Futures Trading Role from London to Asia – The Trade

Citigroup’s global electronic listed derivatives trading business will be headed up in Singapore.

Market Savvy

Euro and Global Stocks Hold Italy-Related Gains Ahead of ECB – Reuters

The euro held firm, having seen a wild three-cent swing in the wake of Italy’s referendum, while the region’s bond yields dipped in line with US peers as oil saw its first fall for five days.

Brazil Real Strengthens After Weekend Corruption Protests – Reuters

The Brazilian real strengthened on traders’ relief that weekend demonstrations refrained from directly targeting President Michel Temer, after the currency hit its lowest level since June last week.

South Africa Dodges Junk, Rand Improves – The South African

South Africa sidesteps a ratings downgrade to junk. As a result, the rand has strengthen just over 2% to the US dollar.