UK To Criminalize Commodities and FX Manipulation

The U.K. government plans to criminalize the manipulation of seven more benchmarks in markets from foreign exchange to gold and oil as it tries to revive confidence in the integrity of London as a financial center.

The Treasury today started a review into whether it should extend legislation regulating the London Interbank Offered Rate to cover other key rates including the WM/Reuters 4 p.m. London currency fix, the Sterling Overnight Index Average, the London gold fixing and the ISDAFix, according to a statement. The government aims to have the rules in place by the year-end — five months before the next general election.

The U.K. is stiffening the penalties for manipulation after benchmarks set in London were tainted by scandal. At least 10 firms have been fined almost $6.5 billion for rigging Libor and related gauges, and regulators are probing whether traders rigged key foreign-exchange rates used by fund managers.

via Bloomberg

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza