Market seeks clearer guidance on precious metals benchmark rules: sources

02-Feb (Platts) — There have been some hiccups with the LBMA Silver Price so far this year, which have caused many to question the electronic system’s effectiveness.

The LBMA, which does not participate in daily operations, declined to comment on the matter.

Both CME and Thomson Reuters declined to comment on the matter of central clearing or increased participation, pending an investigation into last week’s settlement issues.

“We are investigating the trading activity that took place during the Thursday January 28 auction. It would be inappropriate to provide any further comment at this stage,” Thomson Reuters said.

On January 28 the benchmark settled 6% below spot.

“It’s very simple. The system needs more members. Clients need to be able to trade through the banks that they already have credit lines with,” said one fund manager.

He reiterated the view that more guidance needs to be given by the Financial Conduct Authority.

The FCA did not respond to requests for comment.


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