FIA generally supports the LME's efforts to establish a transparent framework for market suspension based on consecutive Daily Price Limits (DPLs). However, the letter notes several concerns and suggestions regarding the current proposal, informed by best practices outlined in the FIA document and feedback from members.
Transparency is a fundamental pillar in Financial Market Infrastructures, and we recommend the LME to provide an updated Daily Price Limits (“DPL”) paper clearly outlining the impact on trading and clearing as well as general impact to market and liquidity risk.
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