Top Headlines

US Judge Narrows Currency Rigging Lawsuit Against Seven Banks – Reuters

The US judge overseeing litigation accusing 16 banks of rigging prices in the $5.3 trillion-a-day foreign exchange market on Tuesday narrowed but refused to dismiss lawsuits against Deutsche Bank, Morgan Stanley and five other large banks that have yet to settle.

Bank of Japan Sets Bond-Rate Target in Policy Revamp – Wall Street Journal

Japan’s central bank took an unexpected step Wednesday, introducing a zero interest-rate target for 10-year government bonds to step up its fight against deflation, after an internal review of previous measures that fell short of expectations. 

Hedge Funds at Risk as Fed’s Dollar Focus Threatens Bulls – Bloomberg

Dollar bulls beware: the greenback is very much on the Federal Reserve’s radar.

A Clear Message That Central Banks Are Not All-Powerful – Financial Times (subscription)

Once again, financial markets are on tenterhooks about potential interest rate hikes by the Federal Reserve.

Spencer’s ICAP Seen as Next Deal Target in Acquisition Boom – Bloomberg

Though the sale of ICAP Plc’s legacy voice-broking business won’t be completed until later this year, analysts are already scoping out the takeover prospects for the rest of the business.

Analyst Says Algo Trading Behind British Pound’s Heavy Losses Against Euro and US Dollar – Pound Sterling Live

Pound Sterling has slumped sharply right across the foreign exchange market with no obvious catalyst, leading one analyst to blame automated trading for the slump.

It Looks Like the Chance of a President Trump Is Starting to Hit Canada’s Currency – Bloomberg

Derivatives show the loonie is becoming sensitive to the real estate mogul’s rising poll numbers.

Mexico’s Central Bank Tested by Traders as Peso Falls to Record – Bloomberg

The Mexican peso posted the biggest loss among the most-traded currencies as it sank to a record, testing the central bank’s willingness to intervene.

CBI Arrests Shah Over Sebi Nod for FX Derivatives – Times of India

The Central Bureau of Investigation arrested Jignesh Shah and searched houses of four former Sebi officials on Tuesday in a case related to the MCX-Stock Exchange getting a regulatory nod to start trading in currency derivatives.

South African Rand: Comeback Kid – Financial Times (subscription)

The South African rand, having earned the dubious distinction of being one of the most beaten up emerging market currency last year, has emerged as one of this year’s best trades as a rebound in commodity prices and the likelihood that US interest rates would stay lower for longer helped lure investors back in.

Dollar-Hunting Egypt Investors Turn to Most Costly Trade Yet – Bloomberg

As one door for turning Egyptian pounds into dollars slams shut, investors are forcing open another.

Why A Wall Street Journal Currency Reporter Didn’t Understand Money Until He Learned About Bitcoin – Forbes

In 2013, Michael Casey had been a currency reporter at the Wall Street Journal for years when he first heard about Bitcoin.

Regulatory News 

‘Teething Problems’ With New Swaps Margin Rules – The Trade

Several members of the International Swaps and Derivatives Association have discussed initial “teething problems” following the implementation of swaps margin rules on 1 September.

Hibor Jumps in Hong Kong as China Makes It More Expensive to Bet Against the Yuan – South China Morning Post

The key measure of borrowing costs in the world’s leading offshore market for the yuan soared to an eight-month high this week, in a sign that China’s central bank is draining offshore liquidity to make it more costly for traders to bet against the Chinese currency.

Russia Said to See Ruble Stability Through 2019 in Draft Budget – Bloomberg

Russia is drafting its budget under the assumption of three years of ruble stability, according to two government officials familiar with the discussions.

ESMA Seeks Feedback on MiFIR OTC Derivatives Rules – The Trade

The European Securities and Markets Authority has requested feedback on its trading obligation for liquid over-the-counter derivatives.

Company News 

Pound’s Fortunes Not So Bad After All to Top Currency Forecaster – Bloomberg

The pound’s immediate outlook is not as dire as initially predicted, according to Julius Baer Group, the top currency forecaster in Bloomberg surveys.

Firms Explore Blockchain for Reference Data – Profit & Loss

R3 and Axoni, along with seven buy and sell side firms, are working to explore ways that blockchain technology can be used to simplify reference data processes.  

FXCM Upgrades API Tech Aiming at Algorithmic Traders, Institutional Clients – Finance Magnates

The API Technology Solutions Suite is a powerful suite for traders of all calibers and is instrumental to the brokerage’s institutional offering.

How a ‘Trump Factor’ Could Be Behind the Rise in Yields That’s Shaking Global Markets – Bloomberg

The Republican nominee is also boosting the US dollar and hurting emerging market currencies, says SocGen.

ICE Clear Europe Finally Gets EMIR Approval – The Trade

The approval has taken over two years to process, following ICE’s resubmission of its application in 2014.

Egypt FX Shortage Worsens MENA Supply Chain Risk – AME Info

Supply chain risk hit the highest levels in three years across the Middle East and North Africa region during the second quarter this year, climbing to 4.406 from 4.371 according to the findings in a recent survey.

Market Savvy

Asia FX Slumps After BOJ Policy Overhaul; Fed Signals Eyed – Reuters

Most emerging Asian currencies fell on Wednesday, taking their cue from the yen’s slide after the Bank of Japan overhauled its policy framework and adopted a target for long-term interest rates.

Rand Leads Currency Gains as SABMiller-Inflow Talk Sparks Rally – Bloomberg

South Africa’s rand strengthened to a one-month high against the dollar, leading global currency gains, amid speculation Anheuser-Busch InBev has started buying the currency to pay local shareholders for its $104 billion acquisition of SABMiller.

Dollar Edges Up in Thin Trading, Investors Cautious on BOJ, Fed – Reuters

The dollar edged up against a basket of major currencies on Tuesday in light trading as investors made limited moves ahead of the conclusion of policy meetings at the Bank of Japan and US Federal Reserve.

Ruble Weakens With Price of Oil as Citi Sees Currency Overvalued – Bloomberg

The ruble slid with the price of crude as Citigroup said the currency looks expensive compared with Russia’s main export earner.