UPDATE 1-U.S. Treasury to release post-trade Treasury volumes starting next year -official


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(Adds details from Treasury official on data plans)

By John McCrank and Jonnelle Marte

NEW YORK, Sept 23 (Reuters) – The U.S. Department of the Treasury will work with the Financial Industry Regulatory Authority to release aggregated post-trade Treasuries securities volumes data on a weekly basis starting next year, a Treasury official said on Monday.

“The data will ensure a more level playing field,” Justin Muzinich, deputy secretary of the Treasury, said at a conference sponsored by the New York Federal Reserve.

Currently, different market participants have access to various amounts of post-trade data depending on which services they subscribe to, he said. The new data release, through FINRA’s Trading Reporting and Compliance Engine (TRACE) system, will allow all market participants to have access to the same comprehensive set of data in the $16 trillion Treasury market.

Public disclosure on Treasury trades has been a goal of financial regulators following the “flash rally” in October 2014, in which prices swung wildly within half an hour without a fundamental reason.

Unlike stocks and many other debt securities, there is not a tremendous amount of public data on Treasury trading, which averages about $600 billion a day.

Muzinich said the greater transparency should help investors, who would benefit from learning more about the volumes of Treasury bond trades. He also said investors may be more interested in trading Treasuries if they understand how volumes fluctuate.

Large banks have said disclosure of this data would make it harder for them to get large trades done and lead to less liquidity in the Treasury market. Other market participants, such as electronic market makers, have said more post-trade information would reduce some of their risk when supplying liquidity.

Regulators have also said some details on how Treasury securities change hands could weed out questionable trading practices without harming the market. (Reporting by John McCrank and Jonnelle Marte, Editing by Franklin Paul and Chris Reese)


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