The Global Foreign Exchange Committee( GFXC) continues to discuss what’ s front of mind for the next iteration of the FX Global Code, confirming that artificial intelligence is securely on the agenda as it looks ahead toward the forthcoming review – set for 2027.
THETRADETECHFX DAILY
Preparing the FX Global Code for the AI era
The Global Foreign Exchange Committee( GFXC) continues to discuss what’ s front of mind for the next iteration of the FX Global Code, confirming that artificial intelligence is securely on the agenda as it looks ahead toward the forthcoming review – set for 2027.
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In an official update, the‘ technology and innovation working group’- comprised of 25 contributors across 19 organisations, including the buy- and sell-side, as well as technology providers- confirmed that the potential impact of AI is near the top of the agenda.
Specifically, the group has been tasked with“ identifying emerging technology trends that may impact the FX market; evaluating the impact of digital assets on the FX market, and assessing implications for the 2027 Code review.”
The potential use of AI is expected to“ accelerate further” in FX activities, confirmed the co-chairs of the group – with“ a shift in human roles towards system oversight rather than direct execution” having also been observed.
This is a much-debated topic across the industry, with the buy-side in particular very vocal about the importance of keeping individuals on desks steering the ship.
Speaking to The TRADE earlier this year, Cyprian Zimecki, senior multi-asset trader at Vontobel Asset Management, asserted:“ For the time being, human judgment and expertise remain essential in almost all aspects of trading. Whilst AI can help us reach what seem like educated decisions faster, it can also lead to a false sense of confidence in our reasoning which ultimately does not translate into good outcomes for clients.”
He continued:“ On balance, I do think we are a long way away from AI being able to consistently mimic cognitive functions associated with all types of human intelligence. This applies to both trading and investing in general.”
Echoing this, Luke Mahon, head of trading at Azimut Investments, explained that“ from a trading desk perspective, [ we ] are not yet at the stage where the industry is ready to hand full trading autonomy to AI agents” for this exact reason.
He added:“ While the capabilities are evolving quickly, trust, governance and control remain critical considerations. The most immediate and tangible benefit of AI on the trading desk is workflow optimisation and productivity enhancement.”
Indeed, the GFXC has also flagged various potential implications of the technology, including impacts on governance, surveillance, and operational resilience.
When it comes to next steps, the working group has confirmed it would“ undertake a more in-depth assessment of the impact of emerging trends, such as AI and of digital asset development, including stablecoins, on FX market functioning,” adding that the assessment is set to inform a preliminary view on potential changes to the Code.
Relatedly, the GFXC’ s‘ governance in a fast-paced FX market panel’ highlighted the need for governance to keep pace with swift technological change.
The experts made clear that in the face of rapid innovation,“ financial institutions maintaining general accountability despite
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