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The Central Bank plans to implement the FX Global Code in the domestic forex market by the end of this year.
The Central Bank (CB) plans to implement the FX Global Code (FXGC) in the domestic forex market by the end of this year, aiming to foster a deeper and more liquid foreign exchange market and develop adequate systems for managing exchange rate risks. The CB revealed that it is currently in discussions with the ACI Financial Markets Association and market participants to facilitate this implementation. The FX Global Code provides a common set of guidelines to promote a robust, fair, liquid, open, and appropriately transparent market, enabling participants to transact confidently and effectively at competitive prices that reflect available market information. This set of global principles, developed to maintain the integrity and effective functioning of the wholesale FX market, covers areas such as ethics, governance, execution, information sharing, risk management and compliance, and confirmation and settlement processes.
First published in 2017 and recently reviewed in 2021, the FX Global Code is a living document created through a collaboration between the public and private sectors, including central banks and market participants. The CB's commitment to the FXGC aligns with its continuation of the current flexible exchange rate regime, which is expected to enhance trade competitiveness and external sector stability, contributing to medium-term economic stability. Market-determined exchange rates are anticipated to address the previous anti-export bias and mitigate the buildup of speculative pressure and subsequent volatility in exchange rates, thereby supporting overall economic resilience.
