Derivs - FX

Michel Barnier, EU internal market commissioner-designate, who will lead derivatives regulation in Europe, told European ministers in Brussels this afternoon that regulation of over-the-counter derivatives market will not be delayed if the U.S. and Asian authorities haven’t implemented similar regulation by year-end.

Banks have been building one- and two-week short butterfly trades on the U.S. dollar against the euro, sterling and Canadian dollar, expecting implied volatility on all three pairs to come down.

Exporters in India and Korea have been hedging long U.S. dollar exposures on the belief the greenback will continue to weaken against Asian currencies.

Romanos Daniel, a former executive director of rates and hybrids derivatives trading at Goldman Sachs in Hong Kong, is set to join Bank of America Merrill Lynch heading up fx and rates exotics trading.

Hedge funds and corporates will look to snap up U.S. dollar calls against the euro next year as industry officials question the health and long-term profitability of the European banking sector.

BNP Paribas plans to expand its fx sales headcount by 20% next year, according to Garry Popofsky, managing director and head of fx and emerging market sales for the Americas in New York.

A European Parliament committee is working on a position paper on over-the-counter derivatives regulation.

Banks were selling one-year puts on the euro against the U.S. dollar today after spot dropped well below USD1.45 in overnight trading after being at USD1.46 at the start of the week.

The U.K. Financial Services Authority is not in favor of imposing position limits on over-the-counter derivatives, going against a proposal put forward by the European Commission in October.

Royal Bank of Scotland has reportedly hired Wayne Ng, the former head of fx sales to greater China at Calyon, as head of fx sales for North Asia.

Morgan Stanley is courting recruits to build its fixed income sales platform in the U.S. and in parts of Asia.

With investors concerned about the falling value of the U.S. dollar, some brokers are recommending structured notes denominated in foreign currencies.