UK watchdog to consider forex rules after probes completed
LONDON, Nov 19 (Reuters) - The first set of rules for the unregulated multi-trillion dollar foreign currency markets will be considered after the completion of probes into possible manipulation, Britain's Financial Conduct Authority (FCA) said on Tuesday.
The FCA, along with watchdogs from the United States and elsewhere, is investigating if traders at several banks have tried to rig foreign exchange benchmarks.
This follows uproar and hefty fines for several banks for rigging the London interbank offered rate, or Libor, a widely used interest rate benchmark.
FCA Chief Executive Martin Wheatley said the watchdog was gathering "facts and evidence" about what may have happened in forex markets.
"If that evidence suggests a more fundamental problem, then you've always got a set of responses," Wheatley told reporters.
"One response says you have to enforce against poor behaviour, and the other response is to look at the conditions that allowed that behaviour to exist. That is what we did with Libor and came up with a set of structural changes," Wheatley said.
"Frankly it's an unregulated market and that would be a big policy change for global regulators to decide that forex needed to be a regulated market. The truth is we are at a very early stage and a long way off before we can make any conclusions."
So far there has been no sign of any global calls for regulation of forex markets as was seen with Libor.