'Don't make us clear inflation swaps,' dealers plead
Market is too concentrated to cope with a default, participants warn
Inflation swap clearing should not be compulsory when it launches next year, some dealers are warning. The collapse of one of the big banks that dominate the market would overwhelm a central counterparty's (CCP) ability to cope, they fear – and even LCH.Clearnet, which had been hoping to start offering the service during 2013, suggests a bedding-in period might be needed before regulators step in.
"The UK inflation swap market is hugely concentrated. It is dominated by five or six dealers. If
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