According to ISDA:
The semiannual market report issued by the International Swaps and
Derivatives Association (ISDA) showed that worldwide growth in the use of
privately negotiated derivatives, as measured in the notional principal of
outstanding transactions, slowed to 3.4% in the first half of 1999.
The notional amount, which is a measure of volume but not risk, totaled
$52.711 trillion at June 30, 1999 compared to $50.997 trillion six months
earlier and $36.974 trillion one year earlier.
"The slowdown reflects the return of credit and currency stability from
the exceptional volatilities associated with the Asian crisis, the Russian bond
default and other events in the previous two years," said Thomas K. Montag,
vice chairman of ISDA and co-chair of the association's market survey committee.
Mr. Montag is a managing director at Goldman Sachs & Co. in London.
"The period witnessed vigorous growth in newer hedging products such as
credit and energy derivatives, but these as yet account for a minor portion of
the business," he said.
ISDA's survey, compiled by Arthur Anderson, tracks market behavior twice
yearly by totaling the combined outstandings in interest rate swaps, currency
swaps and interest rate options which the association's members report as a
single statistic without breakdown by product, currency or otherwise. The
first-half 1999 result announced today represented data provided by 102 members.
The outstandings of the 71 of them who also participated in the previous survey
produced practically the same result, a growth of 5.7%.
