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Deutsche Bank has signed the statement of commitment to the FX Global Code to support an industry-wide initiative to promote integrity in the foreign exchange market. The bank’s statement has been posted on the CLS Global Code Register.
The FX Global Code is a set of global principles of good practice that was developed by central banks and market participants and launched last year. By signing up to the Code, Deutsche Bank says it has committed to continuing to run its FX business according to these principles, which cover topics such as ethics, governance, information sharing, risk management and compliance.
In the statement, the bank says that the business lines with the group that participate in the FX market
“This is a positive step. It demonstrates our ongoing commitment to a fair, transparent, and resilient foreign exchange market and holding ourselves to the highest standards of behaviour,” says Ram Nayak, head of global fixed income and currencies at Deutsche.
Deutsche Bank took an active role in the drafting of the Code with Russell Lascala, global co-head of global FX, representing the bank on the Market Participants Group. The signing of the Statement by Deutsche brings the number of institutions on the CLS Register to 19, these include Barclays, Citi, Goldman Sachs, JP Morgan and XTX Markets.
The minutes from the European Central Bank’s latest monetary policy meeting reveal anxieties about nations manipulating their currencies for competitive gain.
According to the ECB minutes, which were released today, “A number of remarks were made about recent exchange rate developments.”
It was noted in the minutes that while the euro exchange rate is not a target of ECB policy, movements in the exchange rate are deemed important insofar as they can affect the outlook for growth and inflation in the euro area.
UOB has added two FX solutions to its suite of cross-border financial products and services in China.
The bank has rolled out a solution that enables onshore banks in China to trade directly with banks overseas via the R5-SHCH Connect without having to source for counterparties and to negotiate trade prices individually.
The second FX solution is direct trading between the RMB and the Thai baht, with the bank claiming it is among the first market makers able to support direct trading for its clients through the China Foreign Exchange Trade System (CFETS).
CLS is releasing a new foreign exchange (FX) forecast data report as part of its suite of data products.
CLS's FX Forecast data will provide subscribers with a forward looking view of FX markets on an hourly basis, which the firms says will enable them to quickly detect potential price movements and identify times to trade with greater liquidity, reducing market impact and signalling risk.
In addition, CLS's claims that this data will offer significant benefits to risk and compliance teams, enabling market participants to better predict volume and rate changes, which can help inform their models and views around volume surges.
BNY Mellon has opened an FX trading room in Seoul, Korea, offering liquidity both to domestic clients in Korea looking for exposure to major global currencies as well as to counterparties seeking to trade KRW across Asia-Pacific and around the globe.
Clients transacting through the trading room will be able to execute strategies using a variety of instruments, including spot, FX forwards and non-deliverable forwards.
“BNY Mellon is strengthening its capabilities in Korea to provide a more convenient and comprehensive KRW FX trading service to our domestic and international clients, while also helping them conduct their business more efficiently. This reflects our deep commitment to the Korean market and our confidence in the expansion of our FX trading business,” says Mark Militello, head of markets for BNY Mellon in APAC.
BNP Paribas USA has pleaded guilty to participating in a price-fixing conspiracy in the FX market, the US Justice Department (DoJ) has announced.
According to the one-count information filed last week in the US District Court for the Southern District of New York, between September 2011 and July 2013, BNP conspired to suppress and eliminate competition by fixing prices in Central and Eastern European, Middle Eastern and African (CEEMEA) currencies, in violation of the Sherman Act, 15 U.S.C. § 1.
BNY Mellon is launching an FX prime brokerage service for its institutional clients.
The custodian bank announced in a release today that the new service will launch “in early 2018”.
In the release, BNY Mellon says the service will allow institutional clients to access a significant new source of FX liquidity while helping streamline and reduce operational expenses, including legal and onboarding costs, as well as generating substantial capital and netting gains.
Users of the service will be able to transact a suite of FX products while also having access to pre- and post-trade services in addition to BNY Mellon’s collateral, funding and liquidity capabilities.
The average daily volume (ADV) submitted to CLS in December was $1.56 trillion, down 6.9% from $1.67 trillion in November 2017, but up 13% from the $1.38 trillion of ADV submitted in December 2016.
This increase in total volumes compared to the same month a year ago was driven largely by more swaps trading activity, according to CLS. Last month, CLS recorded an ADV of $1.09 trillion for FX swaps, a 22.4% year-on-year increase.
By contrast, the ADV for spot submitted to CLS in December was $391 billion, down 3% year-on-year, and the ADV for forwards was $81 billion, down 4.7% year-on-year.
BNY Mellon is facing further legal action over activities in its FX business as a class action suit has been filed in New York claiming it “charged excessive rates and mark ups” on ADR conversions.
The bank has previously settled similar cases surrounding so-called Standing Instruction trades with both US authorities and private claimants, however those cases were not brought in regard to the ADR business. As was the case with SI trades, the Plaintiffs claim that BNY Mellon “selected a transaction rate at or near the rate at which the currency traded that day that was virtually the worst for the ERISA Plans”.