BIS reports on settlement risk

The Bank for International Settlements in Basle’s Committee of Payment And Settlement Systems this week published a detailed consultative report titled: Progress in reducing foreign exchange settlement risk (https://www.bis.org/publ/cpss81.pdf)

In a nutshell, it says that significant progress has been made over the past decade and gives the central banks a pat on the back, specifically for the establishment and growth of CLS.

However, it notes that “a notable share of FX transactions is settled in ways that still generate significant potential risk across the global financial system and so further action is needed.”