U.S. and UK Strike Long-Term Deal Over Derivatives
UK and U.S. markets regulators have finalized a long-term agreement this week to jointly oversee each other’s derivatives markets, providing a “bridge over Brexit” that removes concerns of turmoil if Britain leaves the EU without an agreement.
The agreement will minimize the risk of huge disruption to banks, institutional investors and corporations that use derivatives such as swaps and futures to hedge against movements in interest rates, currencies and commodities. Without such an accord, authorities warned that users would have faced much higher costs. The deal is meant to replicate the current agreement between the U.S. and the EU.