Sef reforms could distort new, sounder benchmark rates

Tradition’s Fitzpatrick warns that more ways of trading swaps could dent progress made on fixings

Some worry Sef reforms could be a backward step for electronic markets

The head of Tradition’s swap execution facility (Sef) has warned regulators that any new proposals on the way interest rate derivatives trade might slant the setting of important financial benchmarks.

The Commodity Futures Trading Commission (CFTC) is set to propose new rules on swaps trading that would follow more closely the “any means of interstate commerce” set forth in the Dodd-Frank Act – essentially throwing them open even to voice-brokered or auction-based trades.

At present, Sef