Yuan Weakens After PBOC Sets Fixing Closer to 7 a Dollar – Bloomberg

China’s central bank set its daily currency reference rate marginally stronger than 7 a dollar, leaving analysts anticipating Thursday’s fixing as a key policy signal.

China Digs In to Outlast US in Trade Dispute – Wall Street Journal

President Xi Jinping, struggling to revive economy and quell Hong Kong protests, has little leeway for concessions that would undercut strongman image.

Bullard: Fed Has Adapted to Trade Risks, Won’t Respond to ‘Tit-For-Tat’ – Reuters

After the US central bank reshaped monetary policy around global trade volatility, a Federal Reserve official offered a message to the White House on Tuesday: Don’t expect more rate cuts every time trade policy threats or announcements send markets into a tailspin.

New Zealand’s Central Bank Stuns Markets, Kiwi Dollar Dives – Reuters

New Zealand’s central bank stunned markets on Wednesday by cutting the official cash rate by a bigger-than-expected 50 basis points, and looked set to keep policy lower for longer in the face of growing economic risks.

India’s Central Bank Cuts Rates by 35 bps, More Than Expected – Reuters

The Reserve Bank of India cut interest rates by an unconventional 35 basis points slightly above expectations on Wednesday, its fourth cut in 2019 to try to boost a sluggish economy growing at its slowest pace in nearly five years.

Bank of Israel Says One Thing, Markets Believe Another as Shekel Strengthens – Reuters

Amir Yaron’s honeymoon as Bank of Israel governor lasted eight months.

Bank of Japan Chief Kuroda’s Pain Threshold Put to Test as Yen Rallies and Yields Slump – Japan Times

Global financial turmoil is raising the heat on the Bank of Japan, raising the question of how much pain it can take before it is forced to act.

Labour Government Would Not Block Second Scottish Independence Referendum – Daily Telegraph

John McDonnell has promised a future Labour Government would not block a second independence referendum after a poll showed most Scots now support leaving the UK.

Regulatory News

Wall Street’s Shady Swap Trades Spark Pushback from Regulators – Bloomberg

Wall Street’s push to clean up a $10 trillion corner of the derivatives market is getting poor reviews from an important audience: global financial regulators.

Relying on Liquidity Risks Leaving Investors in Hot Water – Financial Times

Long spoiled by the comforting support of central banks, investors are getting a feel for what it would be like when economic concerns, rather than central banks’ monetary policies, take a bigger role in determining asset prices. 

Legality is Not the Problem with Parallel Currencies – Financial Times

Critics of Italy’s mini-BOT identify the threat in the wrong place.

Beware of ‘Lehman-Like’ Aftershock, Analyst Warns – Financial Times

A recovery in US stocks on Tuesday could merely be the calm before the storm, according to one analyst who has warned investors to brace for a possible “Lehman-like” aftershock following Monday’s broad sell-off.

Crypto News

Chat App Kik Fights Back Against SEC’s Cryptocurrency Lawsuit – Financial Times

Kik, the Canada-based messaging app, has filed a stinging rebuttal to a Securities and Exchange Commission lawsuit that claims its $100m initial coin offering was illegal, accusing the US regulator of “repeatedly twisting” the facts of the case.

Bitcoin’s Use in Online Payments Faces a Serious Regulatory Hurdle – Forbes

Over the past few years, the use of Bitcoin for payments has taken a backseat to the increased focus on the digital asset’s use as a store of value. However, the payments use case is now making a comeback thanks to the development of the Lightning Network, which is a secondary protocol layer that enables cheaper, instant transfers for Bitcoin users.

Facebook’s Libra: It’s Not the ‘Crypto’ That’s the Issue, it’s the Organisation Behind it – The Conversation

In all the hype that has surrounded its Libra currency, Facebook has been able to distract attention away from an important issue. 

Is This the Real Reason Bitcoin Suddenly Soared? – Forbes

The abrupt bitcoin price rally was largely put down to the escalating US-China trade war that’s being stoked by president Donald Trump and yesterday caused China’s yuan currency to weaken to its lowest point in more than a decade, prompting Trump to label Beijing a currency manipulator – but new data suggests there could be more to the latest bitcoin bull run.

Company News

Cboe Chief Rules Out Large-Scale Mergers – The Trade

Cboe Global Markets’ chief executive has shrugged off news of the London Stock Exchange Group’s (LSEG) move to acquire Refinitiv, stating that Cboe does not need large-scale mergers and acquisitions. 

UK Broker TP ICAP on Track to Meet £75m Cost Saving Target – Financial Times

TP ICAP, the UK interdealer broker, has confirmed it will meet its reduced cost savings targets for integrating the £1.3bn deal for ICAP, allowing it to step up plans for more investment from in 2020.

Kantox Partners with Silicon Valley Bank for Corporates – Profit & Loss

Kantox has partnered with Silicon Valley Bank, to offer FX management software to SVB’s corporate clients across the UK.

ICE Expands Data Business by Buying MOVE Indices – Financial Times

Purchase of volatility benchmarks allows exchange group to target growth of fixed income ETFs.

Market Savvy

What is Driving Donald Trump’s Relentless Trade War with China? The 2020 Election – South China Morning Post

The US-China trade war is being co-opted by Donald Trump’s team to try to boost the US president’s election prospects in 2020.

Yuan Battlefront Risks Currency Wars for World’s Central Banks – Bloomberg

China’s move to let the yuan weaken and the US naming it a currency manipulator have opened up a new front the world’s central banks must contend with.

US Dollar: When Will Bulls Turn to Bears? – Reuters

Trump wants it to be cheaper. The IMF says it should be cheaper. Hedge funds think it has room to run. So what gives with the dollar?

Currency War Scare Bolsters Demand for Gold, Yen and Franc – Financial Times

As tension between the US and China spill over to currency markets, Swiss and Japanese policymakers are coming under increasing pressure.