GFXC Issues Guidance Paper on Last Look Process

The Global Foreign Exchange Committee (GFXC), which works to promote a robust, liquid, open, and appropriately transparent FX market, has issued a guidance paper on the application of ‘last look’ trading within the FX market. 

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Last look is a practice used in electronic trading where a market participant has a final  opportunity to accept or reject a trade request made on its quoted price. The new guidance paper provides further clarity to market participants of last look, complementing the existing FX Global Code, which sets out principles of good practice for last look.

The guidance paper emphases that the last look be applied in a fair and predictable manner, and that the process is intended to be used for the price and validity checks only, and for no other purpose.

Further, the paper recommended to ensure a fair and effective last look process, enhance ex-ante disclosures and ensure information is available to regularly evaluate the handling of trade requests.

"The GFXC will continue to watch developments in this area. The guidance provided in this paper should help the market move forward in a productive way,”GFXC Chair Guy Debelle commented.”

"Liquidity providers adhering to these principles and providing transparency about their practices should help to give their clients greater clarity about the process. Liquidity consumers should then use this information to evaluate their execution, ask questions of their liquidity provider's last look process, and evaluate whether to trade with liquidity providers that are using last look,"Debelle added.