WELLINGTON, May 26 (Reuters) - New Zealand’s central bank on Friday said it would follow a new global code of conduct for foreign exchange markets created by the Bank for International Settlements and regulators urged traders to do the same.
Regulators and leading financial firms launched the new guidelines on Thursday. They include measures aimed at forcing universal adoption of the code by the world’s major financial institutions.
“Certainly the Reserve Bank would be following the code of conduct in its foreign exchange dealings,” Deputy Governor Grant Spencer said in an emailed statement, saying that some firms would have to train staff and put enhanced policies in place.
New Zealand’s Financial Markets Authority, which regulates many financial institutions, also said in the joint statement that it was encouraging New Zealand’s forex industry to follow the code, which is not mandatory.
Industry players have said the plan was the foreign exchange industry’s last chance to head off full formal regulation of the $5 trillion-a-day market after a scandal over market manipulation and misuse of client information that saw seven major banks fined about $10 billion at the end of a huge global inquiry in 2015.
Most of the document was published a year ago and the final version’s main additions include measures that ask banks and a new generation of electronic traders to provide more details on the algorithms they use and their trading processes. (Reporting by Charlotte Greenfield; Editing by Bill Trott)