ICMA European repo survey shows outstanding value of 鈧�10.8 trillion
09 April 2025 Europe
Image: IHERPHOTO/stock.adobe.com
The International Capital Market Association鈥檚 (ICMA鈥檚) European Repo and Collateral Council (ERCC) has released its 48th semi-annual European repo market survey.
The survey measured and analysed the value of outstanding repo and reverse repo on the books of 61 entities at the close of business on 11 December 2024.
The total value of repos and reverse repos still outstanding on the books of participants fell back 2.3 per cent year-on-year (YoY) to 鈧�10,860 billion.
The latest total represents the first contraction since June 2020, but was presaged by a deceleration in the rate of growth over the previous 18 months.
The results show the first downturn in market size since June 2020 鈥� though unlike the temporary Covid-induced dip, this decline may reflect a more structural shift, according to ICMA.
鈥淭he transition from quantitative easing to quantitative tightening appears to have hit trading in specific collateral in particular, prompting questions over whether this marks a true turning point for the market,鈥� says the association.
A shift in balance sheet allocation away from Europe and toward the US was also evident, as trading opportunities in the euro area were perceived as relatively weaker.
Correspondingly, European demand for US dollars and Treasuries continued to increase, now reaching record levels in collateral holdings.
Meanwhile, some core eurozone bonds saw diminished investor interest, mirrored in subdued activity across automatic trading systems and CCP platforms.
ICMA believes these dynamics may be linked to political uncertainty and the heavier issuance of government securities.
As the association surveys a sample of the European repo market, the headline number must be taken as the minimum size of the European market.
Additionally, ICMA notes that the latest survey covers the period prior to the tariff regime introduced by the new US administration.
The survey measured and analysed the value of outstanding repo and reverse repo on the books of 61 entities at the close of business on 11 December 2024.
The total value of repos and reverse repos still outstanding on the books of participants fell back 2.3 per cent year-on-year (YoY) to 鈧�10,860 billion.
The latest total represents the first contraction since June 2020, but was presaged by a deceleration in the rate of growth over the previous 18 months.
The results show the first downturn in market size since June 2020 鈥� though unlike the temporary Covid-induced dip, this decline may reflect a more structural shift, according to ICMA.
鈥淭he transition from quantitative easing to quantitative tightening appears to have hit trading in specific collateral in particular, prompting questions over whether this marks a true turning point for the market,鈥� says the association.
A shift in balance sheet allocation away from Europe and toward the US was also evident, as trading opportunities in the euro area were perceived as relatively weaker.
Correspondingly, European demand for US dollars and Treasuries continued to increase, now reaching record levels in collateral holdings.
Meanwhile, some core eurozone bonds saw diminished investor interest, mirrored in subdued activity across automatic trading systems and CCP platforms.
ICMA believes these dynamics may be linked to political uncertainty and the heavier issuance of government securities.
As the association surveys a sample of the European repo market, the headline number must be taken as the minimum size of the European market.
Additionally, ICMA notes that the latest survey covers the period prior to the tariff regime introduced by the new US administration.
NO FEE, NO RISK
100% ON RETURNS If you invest in only one securities finance news source this year, make sure it is your free subscription to Securities 麻豆影视传媒 Times
100% ON RETURNS If you invest in only one securities finance news source this year, make sure it is your free subscription to Securities 麻豆影视传媒 Times
