New forex rules will make traders put up cash daily

Money rules: A board displaying the price of euro and US dollars against British pound sterling outside a currency exchange store in central London. New European Union regulations on foreign exchange trading will make it harder and more expensive to manage currency risk, traders said. — AFP

NEW European Union regulations on foreign exchange trading will make it harder and more expensive to manage currency risk, traders said, especially for large financial counterparties such as hedge funds and insurance companies.

The regulations will impose “variation margins” on banks, companies and funds that use currency forwards and other derivatives to hedge exposure to currency swings.