US Fed's Powell speaking in Salzburg
- Fed looking at enhanced supplementary leverage ratio
- banking industry faces far less liquidity risk than before the crisis
No comment on US economy or mon pol in his speech which is a closed event for press.
"The Federal Reserve is reassessing whether the Volcker rule implementing regulation most efficiently achieves its policy objectives
The leverage ratio is an important backstop to the risk base capital frame work but it's important to get the relative calibrations of the leverage ratio and the risk-based capital requirements right."
The Volcker Rule refers to § 619 part of the Dodd-Frank Wall Street Reform and Consumer Protection Act, originally proposed by American economist and former United States Federal Reserve Chairman Paul Volcker to restrict United States banks from making certain kinds of speculative investments that do not benefit their customers.
Volcker argued that such speculative activity played a key role in the financial crisis of 2007-2010. The rule is often referred to as a ban on proprietary trading by commercial banks, whereby deposits are used to trade on the bank's own accounts, although a number of exceptions to this ban were included in the Dodd-Frank law.
The comments echo those made in testimony to Congress last week.
USD unfazed generally but GBPUSD rallying to 1.2730 from its test of 1.2700 as EURGBP also retreats from 0.8800.
Fed's Powell- Reassessing Volcker Rule
