Germany eyes emergency measures for Brexit market panic: source

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Germany could use emergency measures to counter any market panic from a hard Bre...

FRANKFURT - Germany could use emergency measures to counter any market panic from a hard Brexit, an official with direct knowledge of the matter said, such as banning bets on falling share prices, a step last used in the financial crisis.

In the event of a slide in markets, authorities in Frankfurt, Amsterdam and Rome could curb the form of trading known as short-selling, officials in those countries told Reuters, in order to stem any exaggeration of price swings. Germany has done so before. During the financial crash last decade, BaFin singled out a number of banks and other companies to stop short-selling in those stocks.

Rome could take similar measures. An Italian official, speaking on condition of anonymity, said its financial market regulator, CONSOB, could impose a short-selling ban if “extreme volatility” around Brexit were to endanger financial stability. Under EU law, national authorities have the power to introduce such bans. They are required to inform the EU umbrella body, the European Securities and Markets Authority, an ESMA spokesman said.

 

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