Excerpt from: Forex News
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| February 19, 2009 | | CDS contracts in Europe to move through central clearing | One of the main problems that contributed to the global financial crisis and subsequent economic downturn was the proliferation of credit default swaps. These contracts are difficult to value, and have toxic assets, and it has been difficult to get them moving through the European system.
Now, though, things have come to a resolution and credit derivative players and regulators have agreed on a central clearinghouse for CDS contracts. The Financial Times reports on the response from European Union leaders:
"Central clearing... is particularly urgent to restore market
confidence... I welcome today’s commitment from the industry,” said
Charlie McCreevy, EU internal market commissioner.
This news is also likely to further buoy the euro in forex trading, providing some momentum to the EUR/USD rally currently underway.
| Topic Tags: CDS contracts, central clearing, credit default swaps, currency trading, EUR/USD, euro forex trading, European Union, forex trading | |
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