Recent turbulence in various markets has raised concerns among some policymakers about their ability to see and monitor the risk exposures faced by counterparties from their derivatives transactions. Key data about these exposures is available due to mandated derivatives trade reporting requirements – via derivatives trade repositories – that have been established over the past decade.
But, for a variety of reasons, this information may well be ‘hidden in plain sight’ – not easily understood, not readily functional, not easily shared between policymakers, and therefore not as useful as it should be. This paper from the International Swaps and Derivatives Association (ISDA) highlights relevant data that is available, discusses its value, explains the hurdles policymakers face in effectively using it, and suggests steps that policymakers might take to address and overcome these challenges to improve the usefulness and functionality of the data they currently receive.