Volcker rule could interfere with bank hedging

Former Federal Reserve chairman Paul Volcker

Dealers in the US could find their market-making and hedging freedom curtailed by a proposed ban on proprietary trading, if the final rules mirror an ambitious study published on Tuesday (January 18) by the Financial Stability Oversight Council (FSOC). Lawyers say it's too soon for alarm because the proposals may prove unenforceable, and even the FSOC admits they would be impossible to introduce at present.

The ban - more commonly known as the Volcker rule - is required under section 619 of the

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