DAVOS, Switzerland - Canadian and other major government bond markets should be exempted from the United States' controversial Volcker rule, Bank of Canada Governor Mark Carney said on Wednesday, upping the stakes in a growing row over the rule's impact overseas.
The Volcker rule, mandated by the 2010 Dodd-Frank financial oversight law, aims to restrict banks from engaging in speculative investments that do not benefit their customers, and will apply to foreign banks' U.S. subsidiaries as well as to domestic institutions.
However, there is growing concern from foreign governments - the issue has been raised in the UK, Japan and Canada - that the new rule and other parts of the Dodd Frank financial oversight law will give American regulators increasing jurisdiction over non-U.S. banks.
Carney expressed concern that U.S. Treasuries' exemption from the rule would create an unlevel playing field for government bond markets.
"We note with interest that the
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