Morgan Curtails Direct Dealing In New York EMS Currencies Affected, Illiquid Markets?

BANKS

In response to dwindling liquidity and reports of narrow profit margins, Morgan Guaranty has recently scaled-back its direct dealing operations in the foreign exchange market, and no longer makes markets in a number of the EMS currencies in New York.

Sources at the bank say that Morgan will continue to quote the pound, Deutsche mark, Swiss franc and yen, but has discontinued making markets in the Netherland guilder, Spanish peseta, French Franc and Italian Lira.

According to a bank spokesman,