Abstract
This report sets out a number of recommendations for reform in the FX markets and in the benchmark rates that have been identified as pre-eminent by market participants – in particular, the WM/Reuters (WMR) 4pm London fix produced by the WM Company. The work of the FSB in this area was initiated in response to concerns raised in 2013 about the integrity of FX benchmarks. These concerns stemmed particularly from the incentives for potential market malpractice linked to the structure of trading around the benchmark fixings. The FSB’s recommendations fall into the following broad categories: the calculation methodology of the WMR benchmark rates; recommendations from a review by IOSCO of the WM fixes; the publication of reference rates by central banks; market infrastructure in relation to the execution of fix trades; and the behaviour of market participants around the time of the major FX benchmarks (primarily the WMR 4pm London fix).