Fed Set to Push Ahead on New Commodity Trade Rules

The Fed will publish an "advance notice of proposed rulemaking" on Tuesday, laying out the issues it is considering, one day before a second Senate banking committee hearing on the matter, the sources said.

The notice and Wednesday's hearing will provide the first glimpse into the Fed's response to growing public and political outcry over the risks of allowing banks to trade physical commodities such as tankers of crude oil and pallets of copper.

It is not clear what measures the Fed may propose. The public is expected to have 60 to 90 days to submit comment letters, which the Fed can use to formulate its rules.

A Federal Reserve spokeswoman declined to comment.

Over the past year, lawmakers have pressed the Fed to examine whether Wall Street's biggest banks, including JPMorgan Chase & Co and Goldman Sachs Group Inc, should be allowed to own assets such as metals warehouses and oil tankers, and to trade physical commodities alongside commodity derivatives.