Global regulators published details of their plans to overhaulforeign-exchange (FX) benchmarks in response to allegations thattraders colluded to manipulate rates in the $5.3 trillion-a-daycurrency market.
The Financial Stability Board (FSB) proposed changing how themost popular rates, from WM/Reuters, are calculated by extendingthe length of the one-minute windows on which the benchmark is based, andrequiring firms to install systems to address potential conflictsof interest with clients. The Basel, Switzerland-based FSB set anAug. 12 deadline for comments on the plan.
There are “clear benefits to having a wider window,” the FSBsaid in its report. “More data points would be available to helpfix the rate, and it would be harder to manipulate.”
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