THE LONDON Metal Exchange (LME) is under pressure from UK regulators, with the Financial Conduct Authority (FCA) and Bank of England (BoE) yesterday announcing a review into its suspension of nickel trading last month.

The FCA will review the LME's approach to managing the suspension and subsequent resumption of the nickel market. Meanwhile, the BoE will assess the operation of its clearing house - LME Clear - during the same period to establish future improvements to its governance and risk management.

Trading was halted by the LME last month on 8 March, following historic levels of volatility. Prices doubled to more than $100,000 per tonne within the course of one morning, causing LME to suspend trading for over a week.

City A.M. understands the FCA's review will be split into two parts, focusing on both the facts and potential lessons to be learned for future trading.

(c) 2022 City A.M., source Newspaper