Foreign Exchange
Canada governor says ‘manipulating markets not in our game plan'
Stephen Poloz says attempts to influence exchange rate, including via ‘verbal guidance', would ‘do more harm than good'
Offshore renminbi has increasing impact on Asian exchange rates
How long the independent impact will last will likely depend on China's progress in liberalising its capital account, according to working paper from the Bank for International Settlements
Aid ‘surges' benefit countries where currency or inflation is allowed to rise
If large inflows of aid are ‘sterilised' in an attempt to curb inflation or maintain a set exchange rate, the economy will not feel the benefit of aid, a new IMF paper finds
Hungary targets forint entry into CLS
Hungary's central bank has committed itself to bringing the currency into CLS, and sources believe it could be added as early as next year
Russia 'welcomes' weaker currency as central bank sticks to float plan
Russian rouble is latest currency to be hit in emerging markets turmoil, but analysts believe the central bank will stick to its stated policy - or loosen their grip on the exchange rate
Security of hard pegs ‘illusory', IMF economists find
Re-examination of exchange-rate regime orthodoxy finds hard pegs are too risky, but 'managed floats' can have 'significantly lower risks'
Offshore RMB market booming in London, report finds
A study by the City of London Corporation reveals the City's efforts to become a global hub for renminbi business are paying off, with daily spot value reaching $4.8 billion last year
Dealers losing exclusive role in foreign exchange, BIS report notes
A new analysis of the 'anatomy' of the forex market notes the increasing influence of non-dealer financial institutions, following this year's triennial survey
Czech central bank starts targeting exchange rate
Czech National Bank finally says it will start intervening in the forex market, a year after it cut rates to the zero lower bound; Czech koruna almost hits target level straight after announcement
Hungary signs RMB swap line with PBoC
Agreement is the People's Bank of China's second with an EU member state following deal with the UK; equals the size of swap line China has with its neighbour Mongolia
FX now a $5.3 trillion per day market, says BIS
The latest BIS triennial survey shows the UK has strengthened its grip on the FX market, while USD/JPY has seen a strong increase in trading activity
FX clearing driven by capital and collateral costs rather than mandate
As mandatory NDF clearing has been delayed, the likely increase in capital and collateral requirements for FX trades is forcing some to consider clearing ahead of the mandate
Israeli committee split over rate cut, minutes reveal
Governor Stanley Fischer used casting vote to keep May rate cut to 25bp after half the monetary committee called for a sharper reaction to tackle the appreciating shekel
Israel cuts rates and buys forex in moves to ward off ‘Dutch disease'
Unscheduled monetary policy decision by Bank of Israel cuts base rate 25bp as central bank launches a forex purchase programme to hold the shekel down after gas finds
HKMA deputy looks to eurodollar model for offshore RMB development
Eddie Yue says offshore RMB market is facing ‘historic transition'; calls for more offshore intermediation and ‘continued relaxation' of RMB flows in and out of China
Emerging markets exports most sensitive to FX changes, says French paper
Banque de France researchers find exports in emerging markets are relatively sensitive to exchange rate changes, while US imports are relatively impervious
Fijian governor hails launch of renminbi currency exchange
Barry Whiteside says currency exchange will boost trade between Fiji and China, which has recently dislodged Japan to become Fiji's fifth largest trading partner
Basel Committee seeks to eliminate principal risk from FX trades
New guidance encourages banks to use payment-versus-payment systems to smooth the settlement of foreign exchange transactions
SNB’s Jordan describes task of maintaining franc exchange limit
Thomas Jordan sets out how the Swiss National Bank has been fighting to keep the franc-to-euro exchange limit in place; explains slight slip-up last week allowing some trades to happen at lower rate
BOJ discusses dollar funding costs through forex swaps
Bank of Japan examines US-implied swap rates amid growing concern over European banks' funding
Asia to develop emergency financial stability safety net
Charles Adams and Lei Lei Song chart the development of the Chiang Mai Initiative Multilateralization and explain three ways to develop Asia’s liquidity support mechanism
Could the Swiss start a trend?
Robert Pringle discusses the Swiss National Bank's action to limit the exchange rate between the franc and the euro, and asks if others should, and will, follow
Taiwan denies controlling exchange rates
Central bank issues “clarification” of the “managed floating exchange rate regime” in place in Taiwan