More is less
The collapse of Lehman Brothers has left banks, pension funds and other institutions scrambling to replace inflation hedges with the investment bank. But this flurry of activity doesn't mean the inflation market is starting to recover - quite the reverse. By Alexander Campbell
Inflation desks are doing more business now than they dreamed possible a few months ago. Just as credit derivatives traders rushed to deal with the vacuum left by the departure of Lehman Brothers - a major counterparty and credit default swap and collateralised debt obligation reference entity - inflation teams have faced crowds of users clamouring to replace hedges put on with the collapsed bank.
"What we have seen has been unbelievable," says Brice Benaben, head of inflation trading at
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