guy debelle : the fx global code speech by mr guy debelle, deputy governor of the reserve bank of australia, at tradetech fx eu, hybrid conference, 8 september 2021. * * * thanks to matt boge for his incredible assistance over my term as chair, as well as grigoria christodoulou and the other members of the gfxc secretariat. tonight i will talk about the recently completed review and update of the fx global code. the updated code was released on 15 july. 1 tonight i will remind you about the important role the code plays in the foreign exchange ( fx ) market. i will summarise the parts of the code that have been updated and talk about the accompanying papers on pre - hedging and last look. fx global code the fx global code was launched in may 2017. it was a direct and important response to the lack of trust the foreign exchange industry had been suffering on the back of a number of instances of misconduct in the market and the associated multi - billion dollar fines. this lack of trust was evident both between participants in the market and, at least as importantly, between the public and the market. the lack of trust was impairing market functioning. the market needed to move towards a more favourable and desirable location, and allow participants to have much greater confidence that the market is functioning appropriately. it is also important to remember what the alternative was in the aftermath of the scandals. there was a decent chance authorities could conclude that a substantial regulatory response was necessary to generate the desired improvement in market structure and conduct. but the code provided the opportunity for the fx market to address the lack of trust and market dysfunction. the code was developed through a public sector – private sector partnership. it was a joint effort of central banks and market participants drawn from all parts of the markets : from the buy side, including corporates and asset managers, and the sell side, along with trading platforms, ecns and non - bank participants. the membership was also from all around the world, drawing from the various foreign exchange committees ( fxcs ) across the globe comprising all the top 15 fx markets by turnover, both advanced and emerging markets. the global foreign exchange committee ( gfxc ) that maintains the code has since expanded to 20 members. the code set out global principles of good practice in the fx market to provide acommon set of guidance to the market. the 55 principles in the code cover ethics, information sharing, aspects of

opportunity to provide greater consistency and usability in disclosures. over the past 18 months, various working groups of the gfxc, drawing on a diverse group of market participants and central banks, have been working on the review. the proposed updates to the code have been through a number of rounds of feedback with market participants through the fxcs round the world, as well as a public feedback process. i would like to thank the broad range of market participants who provided us with feedback. i would particularly like to thank the working groups for their hard work, especially given the challenging environment of the pandemic. the review of the code following this process of review and consultation with industry, the gfxc has published the updated version of the code. the july 2021 version of the code replaces the earlier, august 2018 version. in total, 11 of the code ’ s 55 principles have been amended. the gfxc has also developed disclosure cover sheets and templates for algo due diligence and transaction cost analysis ( tca ) to assist market participants in meeting the code ’ s principles for disclosure and transparency. additionally, the gfxc has published guidance papers on the practices of pre - hedging and last look to support market participants in applying the code ’ s principles in these areas. one area that reflects the development of the market is the role played by anonymous trading. the code has been amended to encourage greater disclosure by those operating anonymous platforms, including of their policies for managing the unique identifiers ( ‘ tags ’ ) of their users. anonymous trading platforms are also encouraged to make available the code signatory status of their users. recognising the value that data related to trading activity holds for market participants, the code now states that fx e - trading platforms ( including anonymous platforms ) should be transparent about their market data policies, including which user types such data is made available to and at what frequency and latency. platforms are also encouraged to disclose the mechanisms and controls by which they are managing or monitoring the credit limits of their users. the risks associated with fx settlement are potentially very significant and have come back into view again following the publication of the previous triennial survey of fx turnover by the 2 / 6 bis central bankers'speeches bis. 4 consequently, the gfxc identified a need to strengthen the code ’ s guidance on settlement risk. amendments have been made to place greater emphasis on the usage of payment versus payment ( pvp )