Futures specialists in the US have cast doubt on the
Commodity Futures’ Trading
Commission’s ability to enforce position limits on
speculative commodity traders – even if the regulator
succeeds in its rulemaking quest to create hard and fast
"It doesn’t look like [the
Republican-controlled] Congress will approve their budget,"
said one analyst in New York. "That’s going to hit
enforcement. You can impose the limits, but if you
haven’t got the budget to put people on the
ground, how are you going to enforce them?"
The position limit proposals are still in the comment phase,
with one senior energy player saying he had prepared 30
separate comment pieces for regulators. "I’d
expect some more comeback," said one market commentator.
"Typically these guys leave it till the last minute."
Michael Cosgrove, head
of strategic projects in energy and commodities at
interdealer broker GFI in New York, said it was essential to
distinguish between physically delivered and cash-settled
derivatives when setting limits.
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