…now FXCM ceases ruble trade as markets prepare for FOMC statement


Big news continues as one of the largest Forex brokers in the world and LeapRate regulated list member, FXCM (NYSE: FXCM) now halts ruble trading as reported by CNBC. The turmoil in the ruble market is continuing as Russia looks to avert a currency crisis into a full blown collapse. While Vladimir Putin is blaming “currency speculators,” it does not really matter as markets could get more rocky as traders react to the Fed’s FOMC statement at 2 p.m. tomorrow, along with forecasts for the benchmark federal funds rate, unemployment, inflation and growth. Chair Janet Yellen is scheduled to hold a press conference at 2:30 p.m.

You can bet those looking for a ruble reprieve are sure wondering what will happen if the statement is interpreted as particularly hawkish. Many brokers will be sitting on the sidelines and have pulled liquidity for the pair as has been reported here on LeapRate and won’t participate in the opportunity for increased volumes due to the increased volatility, such as the aforementioned FXCM. However, an FXCM spokeswoman did reiterate to LeapRate that “volume in this pair at FXCM was very small and not material.” CNBC reported that FXCM halted trading of Russia’s battered currency during Tuesday trade as the currency fell another 25 percent against the dollar. FXCM states it expects major traders of the currency to stop pricing the ruble this week in anticipation of the introduction of capital controls.

Ways to trade ruble volatility indirectly through correlated instruments are discussed in a DailyFX article by quantitative strategist David Rodriguez, click here to read.

FXCMs statement on the matter was as follows: “Most Western Banks have stopped pricing USD/RUB. As such, FXCM can no longer offer this instrument to our clients and will begin closing any existing client trades in USD/RUB effective at Noon EST today, December 16th, 2014.”

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...now FXCM ceases ruble trade as markets prepare for FOMC statement

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