Row 1 - Latest/Ad/FXSurvey/Surveys/Ad

A lack of consensus on whether recent under-performance of Asian currencies will impact China’s willingness to let its own currency weaken is leading to disparate views on near-term valuations.

The body responsible for settling about $6.5 trillion of global daily FX trades has decided against extending its deadlines to accommodate non-US participants who still want to use its next-day settlement service. But it expects the impact to be limited – far too limited to justify the complexity that a change would impose on its members.

Previous changes of policy direction have left analysts undecided on whether to attribute recent sharp corrections to the renminbi reference rate to accident or design – or even a combination of the two.

Despite overlapping in a number of key workflow areas, asset managers continue to face challenges with FX order management systems that struggle to emulate the capabilities of systems designed to manage execution.

Carry traders are going to have to work hard to maintain the momentum of the last few months if expectations of interest rate cuts in the US and hikes in Japan come to pass.

Perception appears to be just as important as reality when it comes to buy-side firms viewing themselves as FX liquidity providers.

Boosting the role of corporate treasury by enabling it to centralize group-wide FX management may sound appealing, but implementation and cost challenges should not be underestimated.

Investors will be hoping that the fall in the value of Bitcoin since US regulators approved the listing and trading of spot Bitcoin exchange-traded products is not a sign of things to come.

Corporates are adopting a variety of approaches to mitigate the impact of uncertainty in foreign exchange markets caused by divergence in economic policy and performance.

Ambitious brokerage firms have precipitated a shift in demand for FX licences, with interest in regulated European and Asian markets on the increase at the expense of offshore jurisdictions.

Is the CME’s new spot FX marketplace further evidence of the trend towards futures and options trading, and away from private deals?

Many corporates are realising the benefits of intercompany netting on FX risk, trading and cash-flow visibility.

Spoiled for choice, FX brokers have become more strategic – and selective – when it comes to choosing liquidity providers.

While many African countries experienced lower interbank FX turnover and saw their foreign-exchange reserves dwindle last year, there are grounds for optimism that 2023 will turn out to be a better year at both regional and national level.

Markets jump on the news that Javier Milei will be Argentina’s next president. A large devaluation is needed, but that leads to the risk of deposit flight.

While the dollar’s international supremacy is unchallenged for now, the wider landscape is shifting. Companies are raising more funding in renminbi and the currency’s use in international payments and settlements is growing.

Corporates are taking a big punt on markets remaining relatively benign, given their apparent lack of confidence in existing FX technology and systems.

The big custody banks are pursuing a variety of digital-asset custody strategies to encourage wider market participation from institutional clients.

The controversy surrounding My Forex Funds has reinforced the view that tighter regulation of foreign-exchange proprietary trading firms is inevitable.

Euromoney talks to Jacques Levet, chief digital officer at BNP Paribas, about the competitive advantage that newly acquired FX fintech Kantox offers.

Market participants have welcomed recent moves to enhance FX liquidity by increasing the efficiency of credit payments for trades.

The frontrunner in the Argentine presidential election campaign has said he wants to abolish the peso and replace it with the US dollar. Is it blue-sky thinking or just greenback dreaming?

European corporates have been the big losers from lower overall FX market volatility in the first half of 2023 as EUR/USD normalised while the yen and yuan continued to struggle.

Despite suggestions that corporates in North America are keen to work with a wider variety of FX counterparties, global banks are relaxed about the potential impact of March’s banking crisis on this lucrative business line.

Analysts are looking beyond China for clues as to where the main Asian currencies will go over the remainder of 2023 as they try to second-guess Japan’s monetary policy plans.

With artificial intelligence already widely used for tasks such as trend analysis, the focus has turned to how artificial general intelligence could chat with FX traders to help them fine-tune their decisions, as well as automate order execution and currency monitoring.

How many Brics are there in a dollar?

Faster securities settlement raises the spectre of increased FX risk as brokers work through the challenges of achieving simultaneous execution of equity and currency trades.

New entrants into the FX market raise the challenge for the body responsible for rules governing FX derivatives, as it mulls the possibility of future updates to how these products are documented and traded.

Extreme FX volatility is proving a challenge for some finance directors who are struggling to minimize the impact on their bottom line.

The standardized approach for counterparty credit risk has not yet proved to be the catalyst for greater use of clearing in the FX market that some expected.

Recent developments in crypto have hardened the view that convergence between digital and fiat currency trading structures is both inevitable and desirable.

The acquisitive fintech group reckons it can accelerate the transition from legacy FX technology by making it easier for tech firms to get their products to market.

Disagreement over where US interest rates are going has split opinion on overall prospects for emerging market currencies.

Central limit order book venues have done well during the past 12 months, but it would be premature to view this as a permanent shift in trading preference.

Big foreign-exchange banks are focussing on enhanced functionality to promote greater use of single-dealer platforms.

The IMF will have its work cut out generating support for its proposal for a multilateral platform for cross-border payments and related foreign-exchange transactions.

The volume of FX trading where there is a possibility of one or more parties failing to deliver on the terms of the trade has prompted various initiatives to find better options for settlement – but the talk is still more about potential than delivery.

When the news broke that Argentina was thinking of merging its currency with that of its neighbour, Brazil, my immediate question was: which Argentine peso?

While no one is willing to bet the farm on anything other than dollar depreciation in 2023, mixed messages from the Fed, and economic and political uncertainty elsewhere mean the greenback could yet defy expectations.

Some leading FX banks have struggled to stay competitive in forwards, swaps and swaptions thanks to SA-CCR rules, but compressing portfolios helps.

Going all out to keep the sell side sweet seems a sensible strategy for success in the difficult P2P FX market.

With little likelihood of currency volatility subsiding any time soon, corporates continue to face difficult decisions when it comes to how best to mitigate FX risk.

FX dealer trading with financial customers may have stagnated over the last few years, but the effects have not been felt evenly across all markets and the impact on price discovery is far from clear.

Despite dire warnings by the Bank for International Settlements, market participants are not wholly convinced that US dollar obligations from FX swaps and forwards pose a threat to the stability of the forex market.

Concerns about the wider economy and its impact on disposable income have eroded individuals’ appetite for FX trading, despite attractive levels of volatility.

State Street’s Chip Lowry, a board member and former chair of the Foreign Exchange Professionals Association, talks to Euromoney about his new role on the Commodity Futures Trading Commission’s market risk advisory committee.

As the industry digests the results of the latest BIS triennial FX survey, Euromoney canvasses opinion on the implications of the key findings.

Market experts fear that continued inflation and poor growth mean that many currencies are vulnerable to the pressure that the UK has seen recently.

Asia’s central banks have fought hard to protect the value of their currencies this year as the dollar has soared. But each of them has a limit to their appetite for that defence.

The weakness of the pound and strength of the dollar has implications for companies on both sides of the Atlantic.

The market for remittances is expected to grow by almost 10% in 2022, driven by diaspora-linked savings.

Recent volatility has encouraged many corporates to switch out of longer tenor instruments.

In public at least, the Bank of England has been determined to end its gilts intervention when it said it would, but it’s getting harder for the BoE to manage its conflicts – and the market doesn’t know what to believe any more.

While the UK government remains unwilling to make notable concessions on its economic policies, the Bank of England will struggle to restore confidence in the embattled pound.

Kwasi Kwarteng’s debt-funded tax giveaway has re-priced UK risk at a stroke, but the high cost may bring scarce benefit.

The recent multi-decade lows experienced by the pound and the yen may have different origins, but they are also a reminder that history has a habit of repeating itself.

Removing UK bonus caps and undermining the BoE could exacerbate a sterling crisis while entrenching US IB dominance.

Europe and the US remain the focus, but LatAm and Asia Pacific will also contribute to volatility in 2022.

The strength of the Australian economy is not enough to convince analysts it is a good time to increase AUD exposure.

Holders of cryptocurrency pay a heavy price for greater privacy.

UK policymakers are trapped between reducing inflation and boosting the flagging economy.

Progress on implementing the proposed minimum global tax rate may be uneven, but it will have implications for all.

China’s support for Russia is part of its strategy to reduce the world’s dependence on the greenback – might it work?

Despite some notable challenges, Latin American currencies could continue to surprise in the second half of the year.

Patchy inter-company loan administration could leave corporates exposed to breaches of transfer pricing guidance.

Markets are trading interest-rate expectations over actual rate decisions – proving the power of market sentiment.

Digitalizing and automating its FX risk management has notably improved a pharma's treasury function.

FX analysts have diverging views on the prospects for the euro over the coming months, after a bank research warning.

European corporates saw losses from currency volatility fall late last year, so hedging has stayed largely unchanged.

The currency’s fairly benign passage through the early months of 2022 is now under threat from a variety of factors, including spiralling inflation, the cost of supporting the currency and even a growing interest in cryptocurrency.

With the US Federal Reserve apparently keen to step up the pace of interest-rate rises over the coming months, it is not just emerging market currencies that are expected to suffer.

Rate increases in major economies away from the US, as central banks battle spiralling inflation, have weakened the momentum the dollar might otherwise have garnered from a hawkish Fed.

A number of commodity currencies have received an unexpected boost from the conflict in Ukraine as Western economies look to reduce their dependence on fossil fuels from Russia more rapidly than previously planned.

A combination of geographical position and commodity strength is working in the country’s favour.

When a group of leading banks were unable to source the roubles needed to deliver in settlement of FX swaps, compression trades saved the day. The episode serves to highlight how fragile very large, complex and interconnected financial markets have become.

China’s approach to central bank digital currency offers clues to how it may build a unique version of decentralized finance.

Despite China’s ambitious plans for its digital currency, the e-yuan will struggle to become a lead player in international trade finance without notable changes, most importantly to capital controls.

With little chance of a swift resolution to the conflict in Ukraine, the effect on FX markets is being felt well beyond the bounds of the former Soviet Union. But not all reactions have been typical for a crisis.

Chinese policymakers may have become more relaxed about fluctuations in the yuan, but no one should doubt their willingness to intervene if the currency moves too far in either direction.

After a generation of low inflation, rising consumer and business costs have leapt to the top of the list of factors influencing FX pricing.

Analysts are keeping a close eye on regional as well as US monetary policy as they attempt to plot a course for the currencies of the countries that form the Association of Southeast Asian Nations.

Many observers remain unconvinced about the Scottish government’s official currency if the country were ever to gain independence.

Turkey’s currency continues to flounder, with hardline president Erdoğan apparently determined to prove that the best way to curb inflation is to reduce – rather than increase – interest rates.

Rebooting the financial system with a new currency could be what’s needed to give Argentina’s economy a way forward.

The Japanese currency continues to slide as traders anticipate interest-rate movement in the US, but even the Fed's hawkish tilt does not guarantee that this direction of travel will be sustained.

As COP26 winds up, Euromoney looks at how a big reduction in fossil-fuel consumption might impact the currencies of the world’s leading coal and oil exporters.

Foreign exchange forwards do not fall within the scope of uncleared margin rules, but that does not mean those rules have no effect on the FX business. Firms are having to consider the pros and cons of switching to cleared trades to avoid being impacted.

Increased intracontinental trade in Africa is a laudable objective, but may serve to highlight disparities in exchange-rate regimes that could further widen the gap between winners and losers.

Increased trading of emerging market FX has prompted settlement provider CLS and some of the world’s largest banks to explore options for extending payment-versus-payment to a wider range of currencies.

China’s qualified domestic limited partnership scheme, which lets foreign asset managers raise money onshore in renminbi to invest offshore, is taking shape – but it is complex. Euromoney has some tips designed to stop you wasting time and money.

Buoyed by the surge in retail trading during the past 18 months, Global Kapital Group is targeting expansion beyond its established FX brokerage business.

Social media celebrities and financial markets might seem like strange bedfellows, but there is nothing phony about the growth of retail FX trading.

The European Banking Authority’s public consultation on guidelines for compliance officers once again highlights the vital role played by FX brokerage compliance teams in combatting financial crime.

As FX traders ponder how the recent increase in coronavirus cases might affect the global economy, it appears they are spending even more time trying to second guess central bank thinking.

Recent reports concerning a payment made by Deutsche Bank to Europe’s largest winery are a reminder that disputes over FX derivatives mis-selling have yet to run their course.