Further hike rates expected this year, says Eurex
17 January 2019 Chicago
Image: Shutterstock
The US Federal Reserve is expected to hike rates further in 2019 but not as fast as the market had hoped, according to a Eurex Exchange market briefing.
The briefing also explained that as the European Central Bank reduces supply, yields are expected to increase (changed supply/demand dynamics) and yields curves are expected to steepen across the G7 currencies, according to Eurex.
Eurex noted that with the overhang of the Brexit and Italian discussion, European volatility could spike more often in 2019.
Meanwhile, Eurex Exchange reported on their over the counter interest rate derivative volume development, revealing that a total of 801 billion notional was cleared for December 2019.
Philip Simons, global head fixed income sales, derivatives, funding and financing, Eurex, commented: 鈥淚n 2019, it is likely that the same thematic trends will continue to dominate fixed-income trading.鈥�
Simons continued: 鈥淪tarting the year off with good momentum is always a step in the right direction and last year was a good year for Eurex across fixed income.鈥�
鈥淭he standout performance of the year was the Italian BTP segment where the short-term Italian futures alone saw a volume increase of 48.6 percent. H1 2018 saw average daily volumes for the ten and two-year BTP futures of 130,269 and 70,639 contracts respectively.鈥�
He added: 鈥淣one of this would have been achievable without the continued support of our members. The success is a testament to those liquidity providers and clients. I am thankful for their ongoing support, which allows me to look forward to 2019 with even more energy and optimism.鈥�
The briefing also explained that as the European Central Bank reduces supply, yields are expected to increase (changed supply/demand dynamics) and yields curves are expected to steepen across the G7 currencies, according to Eurex.
Eurex noted that with the overhang of the Brexit and Italian discussion, European volatility could spike more often in 2019.
Meanwhile, Eurex Exchange reported on their over the counter interest rate derivative volume development, revealing that a total of 801 billion notional was cleared for December 2019.
Philip Simons, global head fixed income sales, derivatives, funding and financing, Eurex, commented: 鈥淚n 2019, it is likely that the same thematic trends will continue to dominate fixed-income trading.鈥�
Simons continued: 鈥淪tarting the year off with good momentum is always a step in the right direction and last year was a good year for Eurex across fixed income.鈥�
鈥淭he standout performance of the year was the Italian BTP segment where the short-term Italian futures alone saw a volume increase of 48.6 percent. H1 2018 saw average daily volumes for the ten and two-year BTP futures of 130,269 and 70,639 contracts respectively.鈥�
He added: 鈥淣one of this would have been achievable without the continued support of our members. The success is a testament to those liquidity providers and clients. I am thankful for their ongoing support, which allows me to look forward to 2019 with even more energy and optimism.鈥�
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