US regulator says rules exacerbated British pound crash

CFTC Commissioner J. Christopher Giancarlo issued a statement Tuesday in response to the “flash crash” of the British pound, which he said was exacerbated by a lack of market liquidity.

{mosads}The pound fell 6 percent against the U.S. dollar on Oct. 7, which Giancarlo said was the 12th major “flash crash” since the passage of the Dodd-Frank Act in 2010.

“We can no longer continue to avoid the question of whether the amount of capital that bank regulators have caused financial institutions to take out of trading markets is at all calibrated to the amount of capital needed to be kept in global markets to support the health and durability of the global financial system,” Giancarlo said. 

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