NYSE Euronext will launch repo futures market trading on 16 July, if it passes regulatory approval.
Seeking to compete with CME, who is aiming to own a futures exchange in London, NYSE will launch its repo futures trading through its NYSE Liffe US that comply with the Depository Trust and Clearing Corporation’s (DTCC) trademark – GCF Repo Index.
With Libor, a diurnal fixing of interbank overnight dollar lending rates, under scrutiny for manipulation, and benchmark rates offered by Federal Reserve losing lustre following the transaction tax introduced by Federal Deposit Insurance Corporation (FDIC), NYSE is optimistic about exploring the $400 billion GCF repo market.
Thomas Callahan, chief executive of NYSE Liffe US, said at an investor meeting earlier this month: “The two things that market participants would usually look at in terms of a short-term benchmark, fed funds and Libor, are both in their own way broken right now,” he said. “The market needs a new benchmark and we think that this could be it.”
