Top Headlines
Swaps End-Users Struggle for Clearing Access: Survey – Risk.net (subscription)
Many derivatives end-users have issues with their clearing brokers that prevent or limit their access to central counterparties, a report by international standard-setters shows.
- Incentives to Centrally Clear OTC Derivatives – Financial Stability Board
- FSB and Standard-Setting Bodies Consult on Effects of Reforms on Incentives to Centrally Clear OTC Derivatives – Financial Stability Board
New Chinese Forex Crackdown to Hit Corporate Hedging – Risk.net (subscription)
Dealers fear a move by the Chinese authorities to reinstate a deposit requirement on foreign currency derivatives could slow a recent pick-up in hedging from local corporates, despite warnings from regulators that firms need to do more to brace for future market volatility.
- China Tightens Controls to Slow Currency’s Fall – ABC News
- China Uses Lower-Profile Swaps Market to Bolster Yuan – The Wall Street Journal (subscription)
- China Is Asking Banks to Avoid Yuan Market ‘Herd Behaviour’ – Bloomberg
These Three Women Made It to Chief Economist at Big Banks. Here’s How They Got There – Bloomberg
While women may be taking on prominent roles from Wall Street to the City of London, gender equality is still a long way off.
Regulatory News
Poor Mifid Data Could Condemn OTC Market to the Dark – Risk.net (subscription)
The transparency rules contained in Mifid II were meant to be a gift to investors. But, over seven months into this new information age, it is a gift that keeps on failing to give. The newly required trading data is hard to access and hard to use.
Initial Margin Phase-In Not Gradual, Says FCA Report – Global Capital (subscription)
A research note by the Financial Conduct Authority has concluded that the phase-in of initial margin requirements for non-cleared derivatives trades will largely fail to make the process “gradual” and easier to stomach for UK counterparties.
OCC Files Clearing Fund, Stress Test Changes with CFTC – Global Investor (subscription)
The clearing fund needed “significant modifications”, according to OCC chairman and CEO Craig Donohue.
Regulators Look to Establish Global FinTech Innovation Sandbox – The Trade
Eleven financial regulators are teaming up to explore the development of a global innovation sandbox following the success of the initiative in multiple countries.
Big Banks Face More Scrutiny as Australia Regulator Embeds Staff – Bloomberg
Australia’s securities regulator will embed supervisors in the big-four banks in a push to get tough on corporate misbehaviour after a string of scandals.
Crypto News
SEC Postpones Decision on Bitcoin ETF Listing to September – Bloomberg
The US Securities and Exchange Commission now has until Sept. 30 to “approve or disapprove, or institute proceedings to determine whether to disapprove” a proposed change from Cboe Global Markets that would allow the fund from VanEck Associates Corp. and SolidX Partners to list.
- Bitcoin Dealt a Blow after SEC Delays ETF Decision – Financial Times (subscription)
- For Wall Street, Bitcoin ETF Decision Could Answer ‘$1 Billion’ Question – CoinDesk
UK-based bank Barclays has denied it is working on opening a crypto trading desk. The statement was made after two employees removed LinkedIn evidence they were working on a digital assets project at the bank.
Why Custody is Crucial for Cryptocurrency Adoption – The Trade Crypto
The safeguarding of cryptocurrencies by custodian banks is the only way institutional investors can begin their journey with the much-hyped digital assets. So will traditional custodians step up to the plate, and could they partner with crypto trading venues?
Company News
CLS Data Confirms ADV Trends – Profit & Loss
CLS Group’s FX volumes have confirmed the trend established by the major platforms that report data by revealing that it handled $1.64 trillion per day in July 2018, down 13.7% from the previous month but up 2.6% year-on-year.
SGX USD/CNH: Record US$61.5 Billion in July Brings YTD Trading above US$255 Billion – SGX
Amid heightened US-China trade tensions, the market’s need to hedge exposure to RMB has grown. Trading volumes on SGX are surging, with a record $61.5 billion traded in July. So far in 2018, the total volume of SGX USD/CNH Futures cleared has crossed US$255 billion.
Crypto Tech Provider for Fund Admins Secures $15 Million in Series B Funding – The Trade Crypto
The investment will allow Libra to release new products and services which will support its fund administrator, trading operations and crypto exchange platform clients.
Market Savvy
Sterling Falls to Nine-Month Low against Euro as Investors Hedge Against Brexit – Reuters
Sterling slid to a nine-month low against the euro on Wednesday as investors sold the currency fearing Britain could soon leave the European Union without securing a trade deal.
Euro Gains as Dollar Rally Fades; Yen Rebounds – Reuters
The euro rose above $1.16 on Wednesday as the dollar’s recent rally ran out of steam, and traders said solid data out of China had calmed investor nerves about recent Sino-US trade tensions, hurting demand for the dollar.
Turkish Lira Weakens Again, Eyes on Washington Talks – Reuters
Turkey’s lira weakened against the dollar on Wednesday, hit by concern about President Tayyip Erdogan’s grip on monetary policy and reports that efforts to resolve a diplomatic row had yet to make tangible progress.
The Yuan at 7 Per Dollar? No Time Soon, Say China Watchers – Bloomberg
The dramatic decline in China’s currency is about to decelerate, according to the respondents in a Bloomberg survey. Only one of 20 traders and analysts surveyed said the yuan will fall below 7 per dollar in the next three months, a milestone level that was last crossed more than a decade ago.