Libor Scandal Seen Boosting NYSE Repo Futures

The scandal impairing confidence in the London interbank offered rate, a benchmark for $360 trillion in securities, may drive demand for interest-rate futures that NYSE Liffe U.S. will start offering this month.

The contracts on NYSE’s U.S. futures exchange will be tied to indexes that track movements in a $400 billion market where bond dealers that trade directly with the Federal Reserve finance securities holdings. The futures were developed to give banks a more direct method of hedging changes in the cost of those transactions, known as general collateral finance repurchase agreements, or GCF repos.

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