Europe may build a central repository of information on over-the-counter derivative trades, which would give regulators and market participants a more transparent view of activity in the sector. This is the most significant item in a policy paper published by the European Commission today (Friday July 3).
Industry bodies lined up to applaud the findings in the Communication – the first stage in a process of reforming derivatives regulation.
In the present climate, the politically correct thing for financial markets trade bodies to do is to seem enthusiastic about what regulators propose, and then hope to guide policymaking in the directions they favour.
Thus, both the Futures and Options Association and the International Swaps and Derivatives Association, which represents the OTC market, put out statements that backed the EC’s efforts, while gently affirming the importance of market choice in risk management.
The Communication on Ensuring Efficient, Safe and...