CFTC leaves shaping position limits rule to Trump administration

By Andrew Ackerman and Alexander Osipovich
The Wall Street Journal
Tuesday, December 6, 2016

WASHINGTON -- U.S. regulators failed to put the finishing touches on a much-debated, long-delayed rule to limit speculation in commodities like oil and gold, opting instead to propose a scaled-back version that leaves its outcome in the hands of the Trump administration.

The Commodity Futures Trading Commission voted unanimously Monday to float, for the third time since 2011, a proposed rule that would cap the size of trading positions firms could take in more than two dozen core commodity contracts, including a variety of energy and precious-metals commodities, to curb any one trader's influence.

The move punts a decision on the rule's final contours to the Trump administration, which has pledged to dismantle the Dodd-Frank financial law that authorized the restrictions.

"I did not want to finalize a rule that next year the commission would choose not to defend or implement," CFTC Chairman Timothy Massad said on a call with reporters.

Specifically, the latest proposal would restrict a firm from owning more than the equivalent of 25 percent of a commodity's estimated "deliverable supply" in a given month. In some cases, however, it would effectively raise the position limits because it would increase the estimated supply of the commodities. Monday's version also gives traders more leeway than prior iterations of the measure if they are managing business risks. ...

... For the remainder of the report:

http://www.wsj.com/articles/cftc-to-repropose-position-limit-rules-14809...