By issuing these Statements of Commitment, the Bank is demonstrating that it is committed to adhering to the principles of these Codes when acting as a market participant in the relevant markets, and that its internal practices and processes are aligned with the principles of the Codes. The principles of these Codes are important in promoting the integrity and effective functioning of these respective markets.
These Statements of Commitment also cover the Bank’s activities in these markets when acting as agent for HM Treasury to manage the UK official reserves (the EEA). HM Treasury has also issued a press notice.
This work follows the Fair and Effective Markets Review (FEMR) which was launched by the Chancellor of the Exchequer and the Governor of the Bank of England in June 2014 to reinforce confidence in the wholesale Fixed Income, Currency and Commodities (FICC) markets in the wake of the serious misconduct seen in recent years; and to influence the international debate on trading practices. The FEMR final report published in June 2015 by HM Treasury, the Bank of England and the Financial Conduct Authority included a recommendation to launch international action to raise standards in global FICC markets by agreeing a new single global FX code.
To ultimately achieve the objective of the Codes, the Bank strongly encourages all market participants to adhere to these Codes, and has extended this expectation to its regular trading counterparties and participants in the Sterling Monetary Framework.
Six other central banks in the European System of Central Banks (ESCB) have simultaneously issued Statements of Commitment to the FX Global Code. All the ESCB central banks are strongly committed to supporting and promoting adherence to the FX Global Code.
Dave Ramsden, Deputy Governor for Markets and Banking, said:
“The Bank is strongly committed to supporting and promoting adherence to these codes. We are leading by example in publishing our Statements of Commitment today and will also expect regular counterparties to commit to embedding these principles of good practice in their market activities. Fair, transparent and robust markets, underpinned by high standards, benefit all participants.”