[ M A R K E T
R E V I E W
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F O R E I G N
E X C H A N G E ]
oreign exchange (FX) markets have become almost
synonymous with mistrust in recent years following a
host of rigging scandals by some of the world’s largest
and most influential financial players. Household names
including Barclays, Deutsche Bank, JP
Morgan, Citigroup, UBS and RBS, among
others, have been found guilty of misde- “A lot of firms realise that
meanours resulting in billions of dollars’
adherence with the Code is
worth of fines and traders being slapped
difficult to achieve and it
with significant prison sentences.
In 2015, the Bank for International
touches multiple parts of their
Settlements (BIS) heralded a new age in
FX when it began work to establish what businesses.”
is now known as the FX Global Code of
NICK DOWNES, CO-FOUNDER,
Conduct. The Code had a clear objective
AXIOM GLOBAL ADVISORS
of curbing the industry’s alleged, and
often proven misconduct , and restore
confidence in the world’s currency markets.
“The FX industry has been suffering from a lack of trust,”
Guy Debelle, deputy governor of the Reserve for the Bank of
Australia and head of the BIS FX working group, said shortly
following the launch of the Code. “This lack of trust is evident
both between participants in the market and, at least as
importantly, between the public and the market. The market
needs to move toward a more favourable and desirable loca-
tion, and allow participants to have much greater confidence
that the market is functioning appropriately.”
With 55 principles addressing a variety of major issues
including ethics, governance, execution, information sharing,
risk management, compliance, confirmation and settlement,
66 // TheTrade // Summer 2018