Consider the following statements about the recently established Global Foreign Exchange Committee G...........

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Consider the following statements about the recently established Global Foreign Exchange Committee (GFXC).

It was established as a research arm of International Monetary Fund (IMF).
GFXC will enforce a FX Global Code that will legally regulate the manipulation of floating foreign exchange by Central Banks.
It will promote collaboration and communication among the local foreign exchange committees (FXCs) of member nations.
It will replace the institution of Bank of International Settlements (BIS).
Indian government has boycotted GFXC due to its non-democratic governance structure.

Select the correct answer using the codes below.

2, 3 and 4 only

1, 2 and 5 only

3 only

1, 2, 3 and 4 only

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Explanation:

This is a very important development, hence the long explanation.

Statement 1: GFXC was established in 2017 as a forum bringing together central banks and private sector participants with the aim to promote a robust, liquid, open, and appropriately transparent FX market.

Statement 2: FX Global Code is a set of global principles of good practice in the foreign exchange market, developed to provide a common set of guidelines to promote the integrity and effective functioning of the wholesale foreign exchange market. The Global Code does not impose legal or regulatory obligations on Market Participants, nor does it substitute for regulation. It is rather intended to serve as a supplement to any and all local laws, rules and regulations by identifying global good practices and processes.

Statement 3: The objectives of the GFXC are:

to promote collaboration and communication among the local foreign exchange committees (FXCs) and non-GFXC jurisdictions with significant FX markets;
to exchange views on trends and developments in global FX markets, including on the structure and functioning of those markets, drawing on information gathered at the various FXCs; and
to promote, maintain and update on a regular basis the FX Global Code (the Code) and to consider good practices regarding effective mechanisms to support adherence.

Statement 4: The GFXC committee has been set up under guidance of the Bank for International Settlements (BIS), an international financial organisation.

Statement 5: India will soon join Global Foreign Exchange Committee (GFXC).