Top Headlines

Swiss Franc Posts Biggest Daily Rise in 2½ Years on Carry Trade Unwinds – Reuters

The Swiss franc held near the day’s highs after posting its biggest single-day rise against the euro since the central bank removed its cap on the currency in January 2015.

Dollar Edges Higher But Outlook Wary – Reuters

The dollar rose against a trade-weighted basket of currencies as investors consolidated positions with the low-yielding Swiss franc and Japanese yen supported amid deepening anxiety over tensions between the United States and North Korea.

Sterling Falls to Three-Week Low vs Dollar Before Output Data – Reuters

Sterling hit a three-week low against a recovering US dollar, falling a third of a percent ahead of industrial output and trade data watched for more signs of the economic impact of the Brexit process.

Why a Franco-German Bargain Will Help Secure the Euro – Financial Times (subscription)

The gains would outweigh the costs and help chart a path for the continent’s future. 

What War? When Danger Looms Near Japan, Some Investors Buy Yen Anyway – Wall Street Journal (subscription)

The yen has risen in earlier cases of tensions on the Korean Peninsula.

PBoC Strengthens Renminbi Trading Band Midpoint Past Rmb6.7 – Financial Times (subscription)

China’s central bank strengthened the trading band for the renminbi by the most in more than two months, pushing its midpoint below Rmb6.7 per dollar for the first time in over ten months.

Hong Kong’s Crowded Currency Trade Enters Perilous Territory – Bloomberg

Hong Kong dollar’s steady decline abruptly reversed Wednesday.

XTX Markets Commits to Zero Hold Time on Last Look – Profit & Loss

XTX Markets says it is now operating a ‘zero hold time’ (ZHT) model in its application of last look to its FX counterparty businesses.

Welcome Moves in Last Look – Profit & Loss (subscription)

There seems little doubt that the industry is shifting gears on the issue.

FX e-Trading Near Saturation, Says Greenwich – FX Week (subscription)

But the next stage in the success story is due, the financial consultancy says.

FX TCA Won’t Resemble Equities Any Time Soon – Profit & Loss (subscription)

The structure of the FX market means that transaction cost analysis (TCA) within this asset class is unlikely to look like it does equities for the foreseeable future, according Dan Torrey, global head of FX e-commerce sales at Northern Trust.

Buoyant Bitcoin Stirs Crypto-Bubble Fears – Reuters

Bitcoin and other “cryptocurrencies” are big money, virtually as big as Goldman Sachs and Royal Bank of Scotland combined.

Regulatory News

FX Forwards Users Drop EU Banks Over Margin Rule – Risk (subscription)

Other dealers do not have to collect margin on physically settled forwards.

EU Regulator Is ‘Looking Into’ Pre-Arranged Trading – FOW (subscription)

Trading firms have said a lack of prohibition by Europe could hamper US-EU equivalence.

Esma Backtracks on Account Segregation – Risk (subscription)

The European Securities and Markets Authority (Esma) has backtracked on stricter rules for depositories that some critics had said would choke tri-party repo markets and prime brokerage.

The Only Game in Town Is Mifid II, Says Bloomberg’s Van Name – FX Week (subscription)

With less than six months to go, market participants are scrambling to get ready.

There’s Still Too Much Risk in the Financial System – Bloomberg

For 10 years, central banks have done what they could to keep markets stable. Governments can’t say the same.

Company News

EBS Direct Is Moving to Automatic Full-Amount for Some Orders – FX Week (subscription)

Manual orders of five million base currency or more will be automatically executed as full-amount tickets from September 5.

Hedge Funds Up in July: BarclaysHedge – Profit & Loss

Hedge Funds gained 1.11% in July according to the Barclay Hedge Fund Index compiled by BarclayHedge.

Barclays Is Said to Hire Nomura’s Tyndall for Currency Trading – Bloomberg

Barclays Plc hired Michael Tyndall from Nomura Holdings as a senior trader for foreign exchange options, according to a person familiar with the move.

Five-Star Foreign Exchange 2017: What Clients Want in FX – Euromoney

The foreign exchange market has long been dominated by a select group of large banks, but Euromoney’s inaugural five-star FX rankings show a different set of banks may be providing the best client service.

Moscow Exchange Continues to See Decline in FX Trading Revenues – Finance Magnates

FX commissions drop despite increase in trading volume due to low volatility and general risk environment.

Market Savvy

Markets on Edge in Seoul as Trump Escalates North Korea Warnings – Bloomberg

South Korea’s stocks and currency fell after President Donald Trump said Kim Jong Un’s regime will face a devastating military strike if it continues threatening the US, an escalation of geopolitical tension that reverberated through global markets.

New Zealand Dollar Dips 1% on Comments from RBNZ Officials – Financial Times (subscription)

New Zealand dollar dropped as much as one per cent following comments from central bank officials that indicated preference for a lower exchange rate against its US counterpart.

Rand Goes from Best Performer to Laggard as Zuma Wins Vote – Bloomberg

The South African rand fell for a second day against the dollar after President Jacob Zuma survived a no-confidence vote that could have brought an end to his administration.