The Foreign Exchange Working Group (FXWG) has been established, following an earlier call and decree back in May by BIS Governors – the group will be headed by Guy Debelle, the Reserve Bank of Australia’s (RBA) Chairman, according to an FXWG statement.
FXWG was founded with the hopes of strengthening a code of conduct and fostering higher standards and transparency in the foreign exchange (FX) market. In particular, the FXWG is presently working to establish a unified global code of principles for FX market participants – the FXWG membership includes not only major financial hubs but also centers in both advanced and developing economies.
A single, global common code of conduct is a necessary goal for the FX industry.
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The aforementioned code will encompass all segments of the wholesale FX market, building off of previous developments and headway pioneered from a number of regional foreign exchange committees (FXCs). FXCs have previously agreed to push forward a more comprehensive focus on an initiative of a single global code for the FX market. The prospective date for the finality of such a code is tentatively scheduled for May 2017.
Helping support the FXWG in parallel will be the Market Participants Group (MPG), which will utilize participants on both the sell-side and buy-side of the market and FX infrastructure providers. Both groups will be entwined with the FXCs. Moreover, David Puth, Chief Executive Officer of CLS, will chair the MPG.
According to Mr. Debelle in a recent statement on the FXWG’s inception, “A single, global common code of conduct is a necessary goal for the FX industry. The Code will be principles-based ‒ rather than rules-based ‒ and will provide guidance on what is, as well as what is not, appropriate behaviour for practitioners in the FX market.”