RBA warns FX market on need to lift its game 13 February 2015 5:27PM John Kavanagh The Reserve Bank has warned foreign exchange market participants that if they do not adopt recommendations for improvements to market practices, they risk being hit with new regulations.Speaking at the FX Week conference in Sydney yesterday, RBA assistant governor Guy Debelle outlined a series of changes aimed at improving the FX benchmarking process, reducing the incentives for manipulation and improving market conduct.The changes were formulated by the Foreign Exchange Benchmark Group, a body set up by the Financial Stability Board in 2013 and chaired by Paul Fisher of the Bank of England. Debelle was a co-chair of the group.The first of the changes will take effect next week. Debelle said the recommendations had been adopted "to varying degrees" but there was still substantial scope for improvement."There has yet to be significant progress," Debelle said.The recommendations of the Foreign Exchange Benchmark Group are not embodied in regulation, although they are recommended by the FSB."There is a strong expectation that these recommendations will be implemented. If they are not implemented, then the likelihood of a regulatory response will increase," he said.Recommendations include a new methodology for calculating FX benchmarks - the so-called London 4pm fix. The window for calculating the fix will be widened and the number of price feeds increased. The new window (five minutes, compared with one minute previously) starts operating next week.The Foreign Exchange Benchmark Group has canvassed the possibility of creating a central netting utility to address problems with dealing arrangements.It has recommended that FX dealers be more transparent about their charges and that dealers separate their fixing business from their regular business. It also called for greater adherence to codes of conduct.It recommended that asset managers do more diligence around FX execution