For the first time, the Financial Industry Regulatory Authority has started reporting aggregate data on the trading volume of Treasury securities reported to FINRA’s Trade Reporting and Compliance Engine, the regulator said Tuesday.
The move was designed to “provide more transparency” to the marketplace, FINRA said. Securities firms started reporting Treasury transactions to FINRA in July 2017 in a move that was designed to provide regulators and policymakers with additional information to boost understanding and “enhance surveillance of this bellwether market,” according to FINRA.
FINRA’s launch of the data followed discussion with the U.S. Department of the Treasury, FINRA spokesman Ray Pellecchia told ThinkAdvisor. He pointed to comments made by Deputy Treasury Secretary Justin Muzinich on Sept. 23 at the 2019 U.S. Treasury Market Structure Conference in New York.
At the time, Muzinich said regulators were “missing comprehensive transaction data” for the Treasury market and the Treasury Department was “working with FINRA to release aggregated data on Treasury volumes for public dissemination.” At the time, the details were “still being worked out, but our recommendation is for FINRA to release the data weekly, with the first publication early” in 2020, he said.
The release of aggregate market volumes would be beneficial for three reasons, according to Muzinich. “First, we think the market will find it very useful to understand how volumes fluctuate, whether as a result of seasonal flows or in response to significant events,” he said at the time.