FX revenues at leading investment banks are set to drop further in 2013 as trading volumes continue to suffer, according to consultancy firm Coalition.

Voice traders are already being sidelined by the big banks as the investigation into fixing the fix gathers steam. How far-reaching will the fallout from the fix scandal be?

As the investigation into the alleged manipulation of FX widens, the jury is out on whether the practice is tantamount to front-running clients or simply a case of hedging. Suggested reforms to the benchmark include handing it over to a public body, or banks’ abandoning fixing-related orders altogether and treating the flow as normal business, while others think regulators’ efforts would be better spent reforming the fix in options contracts.

Authorities in the Czech Republic might be pleased to learn that the koruna is one of the emerging market (EM) currencies most vulnerable to a dollar rebound.

The US government has upped the ante in its criticism of China’s foreign exchange regime, but Lombard Street Research reckons the renminbi is, in fact, overvalued by 30% on a trade-weighted basis, citing, in part, rising unit labour costs and disinflationary pressures.

Investors might fear that official action will be taken aimed at supressing euro strength, but the region is likely to have to put up with a strong currency.

The carry trade has made a comeback among FX investors, but it might be living on borrowed time.

A lack of consistency in how new swap execution facilities (SEFs) report transaction volume data is making it hard for foreign exchange participants to conduct aggregate level analysis with respect to pricing and traded volumes, traders say.

The closure of FX Concepts, one of the market’s oldest FX-dedicated hedge funds, could signal an important turning point for the FX asset management industry.

The global regulatory investigation into possible manipulation by foreign exchange dealers of the WM/Reuters (WMR) 4pm London fix benchmark could be ignoring the structure of currency markets and the way spot desks routinely execute large client transactions, three London-based currency managers tell Euromoney on condition of anonymity.

A sharp spike in US equity markets – with the Dow, S&P500 and Nasdaq jumping by more than 2% on news that US lawmakers might agree to extend the debt-ceiling deadline by six weeks with no fiscal conditions – drove Asian equity markets and key emerging market currencies higher against the dollar, albeit in narrow ranges amid thin trading, according to currency managers.

The rebound in the Australian dollar might set off alarm bells and prompt the Reserve Bank of Australia (RBA) to enter a new round of currency wars, warns the world’s largest custodian bank.

Foreign exchange markets spent last week in thrall to US political headlines as the dollar reversed its weakening trend amid range-bound and volatile trading in G10 crosses.

The deadlock in Washington over the US budget has seen FX volumes drop sharply as investors stumble for direction.

Safe-haven demand for the Japanese yen could return next week, despite the emergence of a more risk-positive tone in global markets, after news that negotiations to extend the debt-ceiling deadline had begun between Republican congressional leaders and the White House.

There has rarely been a tougher time to trade currencies, and investors might need to adjust to a new regime.

Demand for sophisticated cash management services in China is rising as the authorities press for greater business efficiency at home and Chinese corporates expand their foreign operations. Renminbi liberalization is another driver.

The more exacting capital requirements of Basle III are prompting cash management banks to fine-tune their offerings.

Forget about the Belgian dentists and German doctors of old. Today, Luxembourg’s streets are filling with Chinese bankers. They see the Grand Duchy as a hub for their European operations – not least for trading and settlement of the renminbi. Are London, Frankfurt and Paris in danger of being left behind?

London should be wary of the Duchy’s ambitions to become Europe’s RMB hub.

As use of social media becomes more widespread as a tool to disseminate and garner FX market information, concern is mounting about the threat it poses when combined with high-frequency algorithmic trading.

Exchange-based trading of currency derivatives is growing rapidly, according to data published by the Chicago Mercantile Exchange (CME).

Washington dysfunction is weighing on the US dollar. The federal government shutdown, which began on October 1 after Congress was unable to reach an agreement on stop-gap legislation to fund government operations, has seen the dollar fall to an eight-month low against the euro.

The path to success in investment banking these days is pretty much preordained: top university, first-class degree, ball-breaking spell as an intern, some sort of post-grad qualification and no time for any outside interests.

Figures from the IMF show that global reserve managers cut back their holdings of emerging market (EM) currencies aggressively in the second quarter.

Unilever this week became the latest company to attribute slowing sales growth to turmoil in emerging market (EM) currencies.

Brazil’s FX swap intervention is arming speculators for further attacks on the real

The chronic overcapacity built up by the leading banks in the FX market is likely to persist as the cost of building bespoke electronic trading portals continues to rise.

Many assume politicians in the US will strike a deal over raising the country’s debt ceiling, but there is a danger investors might underestimate the risks of a stalemate.

Implied volatility in the FX markets has fallen to levels last seen before the eruption of the financial crisis, a fact that might concern investors who witnessed the violent price action in 2008.