Commodity Futures Trading Commission member Bart Chilton said that the Federal Reserve should reverse a decade-old ruling that lets banks trade physical commodities, Bloomberg News reported yesterday. Banks including Citigroup Inc., JPMorgan Chase & Co. and Morgan Stanley, all based in New York, have been permitted to expand into commodities markets under a 2003 Fed decision and subsequent ones. The central bank said last month that it is reviewing the policy amid Senate scrutiny of whether such involvement allows Wall Street firms to control prices. JPMorgan, the biggest U.S. bank by assets, said days after a congressional hearing on the matter last month that it is weighing whether to sell or spin off holdings in physical commodities. The 10 largest Wall Street firms reaped about $6 billion in revenue from commodities in 2012, including dealings in physical materials as well as related financial products, analytics company Coalition Ltd. said in a Feb. 15 report.
