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Currency market inches towards electronic fix

Published on Mar 18, 2014 2:14 PM

LONDON (REUTERS) - Work is moving forward on a new way for the foreign exchange market to set its "fixing" benchmarks, senior bankers say, after another week of revelations in the row over alleged market manipulation which has rocked the industry.

While there are substantial barriers to altering the fixing system - which is used to price trillions of dollars' worth of investments and deals - the bankers say it is increasingly clear that an electronic-based solution is feasible.

This could seek to match off and then resolve automatically the huge volumes of orders put in around the fixing with minimal human intervention, making foul play more difficult.

Many also expect the scandal to hasten the demise of voice-based trading, whose model of dealers and brokers talking on several phones to multiple clients and banks at once has been a defining image of the industry for decades.

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