Day: 27 October 2016

CFTC Drops Deutsche Bank FX Investigation

The US Commodity Futures Trading Commission (CFTC) has closed its investigation into Deutsche Bank’s FX business, the bank revealed in its Q3 results today.

In May 2015, a number of major banks were fined more than $5.8 billion for practices relating to alleged collusion and manipulation of the spot FX market around the 4pm London Fix, by a number of regulatory authorities, including the CFTC.

Deutsche was not one of the firms named in those settlements, but remained under investigation by the CFTC for its FX market practices.

An Incomplete Picture: Spotting the Spoofer in FX

The incarceration of a trader convicted of spoofing has heightened awareness of the practice, but how hard is it to spot and how prevalent is it in FX? Colin Lambert investigates.

“You have to be pretty desperate to resort to spoofing markets – especially on exchanges where it’s nigh on impossible to shield your
activities,” argues a senior electronic trader in London. “Even in OTC markets it’s not easy to get away with given the MIS capabilities of firms today.”

And Another Thing…

This week’s Bundesbank paper on HFT in bund and equity markets caused a stir – as anything on this subject does of course – and it highlights to me again, how FX is in front of other markets in being inclusive and functional. It is significant that while some regulators want FX to be equities-like in market structure, more are looking to an FX solution – the speed bump – to save equity market problems.
I am not sure we should be talking about speed bumps for the real issue is the dysfunctional liquidity stream.