CBOT steps up war with Eurex

The Chicago Board of Trade (CBOT) will launch three electronically traded German debt futures contracts in what appears an escalation in the exchange’s war with European rival Eurex. It has also reduced transaction fees for its customers that electronically trade US Treasury futures and options.

The contracts, Bund, Bobl and Schatz futures, will be made available on the exchange, pending a review by the Commodity Futures Trading Commission. The contracts had previously been available on other exchanges, including Eurex.

“The CBOT has designed German debt contracts that provide better risk management tools, with features including enhanced settlement procedures,” said CBOT chairman Charles Carey.

The CBOT has also cut transaction fees for members trading on a member-owned account, as well as reducing charges for non-members trading on a member’s proprietary account by approximately 75%. A flat fee was also introduced for futures (30 cents) and options (50 cents) transactions.

Swiss-German exchange Eurex is due to launch a futures exchange in the US this month. It has promised customers low transaction costs.

CBOT president and chief executive Bernard Dan denied the moves were indicative of a 'race to the bottom' with Eurex on prices. “We have a serious long-term commitment to the best trading experience from end-to-end,” he added.