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”.
The average daily volume (ADV) of trades submitted to CLS was $1.677 trillion in November, up 3.8% from the previous month and up 9.2% year-on-year.
This increase in volumes was largely driven by swaps trading. CLS reports an ADV of $1.149 trillion in swaps submitted last month, which represents a 5.4% increase from the $1.09 trillion submitted in October and a 22.6% increase on the $937 billion submitted in November 2016.
Meanwhile, the ADV for FX spot submitted to CLS was $439 billion in November, up 2.8% from the previous month, but down 14.6% year-on-year.
Forwards represented $89 billion of the total ADV submitted to CLS in November, down 10% from October but up 4.7% compared to November 2016.
The US Federal Reserve raised interest rates for the third time this year on Wednesday, citing an improving economy and labour market.
At the end of the Federal Open Market Committee’s (FOMC) two-day meeting, it was announced that the benchmark interest rate would be increased by 25 basis points, to between 1.25% and 1.5%.
“In view of realised and expected labor market conditions and inflation, the Committee decided to raise the target range for the federal funds rate to 1-1/4 to 1‑1/2 percent. The stance of monetary policy remains accommodative, thereby supporting strong labor market conditions and a sustained return to 2 percent inflation,” said the FOMC in a statement today.
The Reserve Bank of Australia and ANZ have announced that they have signed a statement of commitment to the FX Global Code of Conduct.
At the beginning of the month, Profit & Loss reported that 15 central banks had signed this statement of commitment to the Code and in a separate article, noted comments from Mark Carney, governor of the Bank of England, in which he said that the Code may become “more firmly embedded” in the UK’s Senior Managers Regime (SMR), a move which could potentially lead to tangible penalties for firms that do no comply with the Code.