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Forex firing line for BoE's Carney

Tuesday, March 11, 2014 - 01:58

Mar.11 - Mark Carney faces what could be his toughest questioning so far as Bank of England governor. As Ciara Sutton reports lawmakers are expected to seize on a foreign exchange scandal to press their demands for tighter oversight of the central bank.

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He's been here before but this time Bank of England governor Mark Carney knew he was in for a grilling. Lawmakers wanted to know what he knew about the alleged manipulation of foreign exchange rates. The scandal surrounding a largely unregulated market which is worth 5.3 trillion dollars a day continues to snare more victims. More than 20 traders at some of the world's top banks have already been placed on leave, suspended or fired. Last week the Bank of England became one of them - suspending an official and ordering an internal review into whether Bank staff failed to flag up concerns. The allegations date back as far as 2006. Carney says the central bank responded as soon as it found out. (SOUNDBITE) (English) "We first became aware, governors first became aware, or a member of the bank first became aware of allegations related to the issue we are discussing, on the 16th October. I was informed then. I informed the court that day. We convened governors, we decided to launch an investigation within 48 hours, we retained external council and they had begun a very thorough, systematic, relentless investigation" The Bank of England says it's found no evidence that its staff colluded in any manipulation. James Ashley, is a Senior European Economist at RBC Capital Markets. (SOUNDBITE) (English) SENIOR EUROPEAN ECONOMIST AT RBC CAPITAL MARKETS, JAMES ASHLEY, SAYING: "They're not entirely confident that necessarily all of the internal procedures have been followed. And therefore, it's entirely appropriate for them to set up this investigation to check that that is the case. So I think at this stage it's a case of belt and braces. They've found nothing wrong, but because they are the central bank, they need to be whiter than white." Lawmakers are seeking tighter controls at the 320-year-old institution. And Carney says the bank will consider changing its policies to create a new culture. How he handles the scandal could also have implications for the City of London. It accounts for 40 percent of the global currency market.

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Forex firing line for BoE's Carney

Tuesday, March 11, 2014 - 01:58