Banks' NDF withdrawal hits emerging markets currency trading

Banks pull back from warehousing risk ahead of Volcker rule completion

Malaysian ringgit: intraday volatility has surged due to poor liquidity

Offloading emerging market (EM) currency risk in the interdealer market can take up to three times longer than in the past with significantly higher costs, as banks reduce their exposure to non-deliverable forwards (NDFs), traders say.

The pullback from risk warehousing comes ahead of the July 21 deadline for full compliance with the Volcker rule, which will limit banks' ability to engage in proprietary trading, raising uncertainty and costs for US dealers. 

"Generally speaking, if you get hit i

To continue reading...

You need to sign in to use this feature. If you don’t have a account, please register for a trial.

Sign in
You are currently on corporate access.

To use this feature you will need an individual account. If you have one already please sign in.

Sign in.

Alternatively you can request an indvidual account here: