The Reserve bank of Australia believes that Forex (asset class) is a self regulated financial instrument and is functioning effectively.
This is in light of the recent BIS report on High Frequency Trading in Financial Markets.
Some may feel differently as the main regulatory authorises e.g. NFA and FSA have both been dishing out fines to leading names including FXCM and Alpari UK.
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Guy Debelle, Reserve Bank of Australia Assistant Governor, states that “The FX market has basically always been self-regulated and still continues to be self regulated. And by in large, I think that’s been quite effective,”
High Frequency Trading hasnt directly impacted FX markets like it has in the Dow Flash Crash however speculators suggest the massive fluctuations in JPY and CHF are to be blamed by the HFT.
A report by the EU commission will open more communication on the topic and whether or not any regulations will be in place.