Clamour grows for US Treasuries clearing mandate
HFT default could destabilise interdealer markets, participants fear
Market participants are calling on regulators to institute a central clearing mandate for US Treasuries to mitigate the risks posed by high-frequency traders (HFTs) in the interdealer government bond market.
As things stand, roughly 50% of interdealer US Treasury trades executed on platforms such as Icap's BrokerTec and Nasdaq-owned eSpeed are cleared at the Fixed Income Clearing Corporation (FICC). However, banks and interdealer brokers are worried they could be on the hook if an HFT firm that
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