Canadian Forex Traders Haunted by a Slew of Margin Changes, While FxPro Restores Levels

Forex traders in Canada have been presented with a conundrum in recent weeks, as volatility in the foreign exchange market on their domestic currency has been growing rapidly. Just before key, non-farm payroll data releases later this week, the Canadian self-regulatory organization has changed margin requirements on the USD/CAD again.

Rapid swings in oil prices have led to increased fluctuations of the Canadian dollar's exchange rate, which is making it more difficult for local forex traders, relying on high margin-level utilization to accordingly plan their systems.

By now, there is no doubt across the industry that margin requirements of 1:100 and above are likely to be further scrutinized. What the Canadian regulatory environment is unique in is that the industry’s self-regulatory body, the Investment Industry Regulatory Organization of Canada (IIROC), is responsible for determining the appropriate account leverage for each currency pair.

Meanwhile, FCA and CySEC regulated broker FxPro has announced to its clients that the company will be decreasing CHF & RUB crosses margin requirements from 10% (1:10) to 5% (1:20).

At the same time, FxPro updated the leverage requirements on currency pegs involving the Danish krone (DKK) and the Hong Kong dollar (HKD) & the managed float of the Singapore dollar (SGD) crosses will see an increase in the margin requirement from 0.2% (1:500) to 4% (1:25).

The company has also increased the margin requirement on another managed peg - the Chinese yuan (CNH) cross margin requirement will increase from 1% (1:100) to 2% (1:50).

Following is the full list of current margin requirements after the latest hike for the USD/CAD to 2.2%.

Canada IIROC Margin Requirements