The Bank for International Settlements (BIS) has implemented a working group with the sole intent of developing a single consolidated global code of conduct for the foreign exchange (FX) market, according to a BIS statement.
The decision to foster a single legal construct or code of conduct in the $5.3 trillion dollar a day industry comes as little surprise following the recent woes that FX markets have faced. These include benchmark manipulation, ongoing fraud warnings from regulators, and the recent market convulsion propagated by the snap Swiss National Bank (SNB) decision earlier this year.
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As a result, the BIS has tapped Reserve Bank of Australia Assistant Governor Guy Debelle as head of the newly launched group. Mr. Debelle comes with sterling accolades, having co-authored multiple recommendations last year in a bid to purge the industry of benchmark scandals and alleged manipulation.
According to a recent Reuters report, a number of senior central bank officials were optimistic about the coalescence of disparate codes of conduct, relegated to the FX industry that can be effectively implemented across several different jurisdictions.
Last month, the Reserve Bank of Australia stipulated that cryptocurrencies would need to adhere to regulation. As a result, the BIS intervened, replying to a digital currencies enquiry made by the Senate Economics References Committee in Australia.