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6/13/16 - A New Global Code in the FX Market

The Bank for International Settlements in May introduced global governance and risk management standards for the foreign-exchange market that apply to all participants in the wholesale FX market and supersede all FX codes of conduct currently in place. The code is the culmination of a joint regulatory and industry initiative to reform the FX market, and establishes rigorous standards for managing conflicts of interest and handling confidential client information, among other compliance demands.

Central banks may explicitly require their FX trading counterparties to adopt and observe the code, and market-conduct regulators are likely to consider provisions of the code when undertaking supervisory examinations of firms’ FX activities. Please click “Read More” below to read a Sightlines InFocus by Doug Harris, Lisa Megeaski, and Anthony Murphy that helps market participants review their FX-related governance, sales and trading practices, and risk management, and make improvements to align with the code’s requirements.