Who looks after the global forex system?

<p id="isPasted">Because the foreign exchange (forex) market is a decentralised, global "over-the-counter" (OTC) system, there is no single world government or central authority that owns or controls it. Instead, oversight is distributed across several international organisations and national regulators.&nbsp;</p><p><strong>1. Global Coordination &amp; Standards</strong></p><p>While they do not "police" the market in a legal sense, these bodies set the rules for international cooperation:</p><ul><li>Bank for International Settlements (BIS): Known as the "central bank for central banks," it fosters cooperation among national monetary authorities. It hosts committees like the Markets Committee to monitor global financial conditions.</li><li>International Monetary Fund (IMF): Monitors the global monetary system and individual countries' economic policies. It works to prevent "competitive devaluations" (where countries purposely weaken their currency) and provides financial assistance during crises.</li><li>Global Foreign Exchange Committee (GFXC): A forum of central banks and private sector participants that maintains the FX Global Code. This code consists of 55 principles of "good practice" to promote integrity and transparency in the wholesale market. </li></ul><p><strong>2. National Regulators (Legal Enforcement)</strong></p><p>Actual legal enforcement and the licensing of brokers happen at the country level. Key regulators include:&nbsp;</p><ul><li>United States: Commodity Futures Trading Commission (CFTC) and National Futures Association (NFA).</li><li>United Kingdom: Financial Conduct Authority (FCA).</li><li>India: Reserve Bank of India (RBI) and Securities and Exchange Board of India (SEBI). The RBI acts as the custodian of India's forex reserves and administers the Foreign Exchange Management Act (FEMA).</li><li>Australia: Australian Securities and Investments Commission (ASIC). </li></ul><p><strong>3. Market Participants</strong></p><p>The daily "care" of the system's liquidity and pricing is managed by:</p><ul><li>Central Banks: Intervene to stabilize their national currencies during extreme volatility.</li><li>Commercial Banks: Act as "market makers," providing the infrastructure for most global transactions. </li></ul>