Fed to Release Plan to Limit Banks’ Commodities Activities
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The Federal Reserve is poised to take a preliminary step toward limiting banks’ involvement with physical commodities amid congressional scrutiny, according to three people briefed on the discussions.
The Fed is planning to release as soon as today a notice seeking information on ways to curb ownership and trading of commodities such as oil, gas and aluminum by deposit-taking banks, said the people, who requested anonymity because the talks are private. Lawmakers have said dealing in commodities could create conflicts of interest and lead to market manipulation by deposit-taking institutions.