US local governmentsincrease derivatives use

New Angle

Low interest rates combined with law changes are encouraging US local government agencies to increase their use of derivatives, report dealers and rating agencies.

“The market is growing at well over 100% per year, and possibly a multiple of that,” says Matthew Roggenburg, JP Morgan’s New York-based managing director in charge of public finance risk management marketing within the municipal department.

Meanwhile, in May, rating agency Moody’s released a special comment in which it s