“The contract’s monthly expiration will generate interest from inflation swap desks at major banks as well as asset managers and active traders like hedge funds looking for trading opportunities,” said Robin Ross, managing director of CME interest rate products. “An active short-term inflation hedge will allow dealers to free-up their capital to create more structured products of medium- and longer-term tenures, thus contributing to the further growth of the European inflation derivatives market.”
Whereas Barclays Capital was the only market-maker for the US contract, the CME anticipates it will have several market-makers when the HICP futures are launched. The exchange is offering a six-month fee waiver for Globex and clearing fees to all market participants at launch.
The week on Risk.net, July 7-13, 2018Receive this by email