Inflation swap stampede stirs fears of lopsided market

Soaring demand for inflation hedges leaves dealers struggling to balance exposure

Chasing-inflation montage

A surge in sterling inflation swaps activity is fuelling concerns that the market is becoming imbalanced, with too many buyers and not enough sellers at some maturities.

The buying spree has caused bid/offer spreads to widen sharply, making it more costly for pension funds and non-financial corporations to hedge their exposure to rises in UK prices. Spreads for five-year inflation swaps are twice as wide as medium-term averages, says Richard Turner, head of inflation trading at Nomura. In

Only users who have a paid subscription or are part of a corporate subscription are able to print or copy content.

To access these options, along with all other subscription benefits, please contact or view our subscription options here:

You are currently unable to copy this content. Please contact to find out more.

Sorry, our subscription options are not loading right now

Please try again later. Get in touch with our customer services team if this issue persists.

New to View our subscription options


Want to know what’s included in our free membership? Click here

This address will be used to create your account

You need to sign in to use this feature. If you don’t have a account, please register for a trial.

Sign in
You are currently on corporate access.

To use this feature you will need an individual account. If you have one already please sign in.

Sign in.

Alternatively you can request an individual account here