German Chancellor Angela Merkel expressed confidence that despite difficulties with Brexit negotiations, the EU and UK can come up with a deal. "If we are all clear in our minds, I have absolutely no doubt that we can reach a good result," she said after the first day of a summit of EU leaders in Brussels.
The European Commission is working to ensure that resolution authorities assessing failing financial institutions can hire more than one valuation agency to avoid disputes. Multiple valuations are expected to help authorities determine "with absolute certainty" whether they must intervene, said Emiliano Tornese of the European Commission.
The European derivatives market comprises 33 million transactions with a notional value of €453 trillion, according to the European Securities and Markets Authority. ESMA's study found that over-the-counter transactions account for 94% of interest-rate derivatives trades.
The question of who should bear the cost of a custody bank failure is dividing clearing banks and central counterparties as regulators work to establish recovery and resolution rules following Financial Stability Board guidance. The question revolves around which party controls the risks.
A London court granted Tom Hayes, a former trader who was sentenced to 11 years for manipulating the yen London Interbank Offered Rate, permission to appeal part of a confiscation order related to the £878,806 he paid to UK authorities. "We oppose this application and will argue against it in court," a Serious Fraud Office spokeswoman said.
The European Parliament will amend the revised Markets in Financial Instruments Directive to apply a tick-size rule to systematic internalizers, said Markus Ferber, a member of Parliament who is leading a review of the legislation. Currently, the directive's tick-size rule doesn't apply to these entities.
Senate banking committee Chairman Mike Crapo, R-Idaho, said the Federal Reserve should return to "more normal, traditional monetary policy." Crapo also expressed concern over the size of the Federal Reserve balance sheet and the slow pace the Fed has raised rates.