Financial Stability Board to review Forex rates
There has been concern in certain quarters that some senior staff at major financial institutions had been rigging the foreign currency markets for their own personal gain. The Financial Stability Board which is chaired by the Governor of The Bank of England, Mark Carney is setting up a working group whose aim is looking at ways in which that the benchmark currency rates are not manipulated by traders.
The problems were first observed and reported by Bloomberg last year and since then it has been seen that some London based dealers have suspended staff or they have left.
On Friday 14th February a statement was issued by the FSB in which they said that a number of concerns had been drawn to their attention and that they had decided to include an assessment of FX benchmarks into its ongoing programme.
Amongst the senior officials who will be drawing up methods to ensure the rate-setting process less prone to manipulation, is Paul Fisher who is executive director for market at the Bank of England.
The FSB was first established during the G-20 summit held in London in 2009 which it is recalled was against a backdrop of the crisis seen in the financial sector and it is them who make recommendations about the global financial system.