Scrutiny of Wall Street metals trade a 'positive' for CME -exec chairman

08/01/2013

Aug 1 (Reuters) - CME Group Inc, the world's biggest futures exchange operator, is closely watching regulators' escalating scrutiny of Wall Street's commodity trading and could benefit if it resulted in increased futures trading, top officials said Thursday.

Critics have charged that brokers' trading and stockpiling of metals and other commodities have led to higher prices for consumers, and the Federal Reserve is reviewing its decade-old decision to allow banks to trade physical commodities.

Such scrutiny is "potentially a net positive for us," CME Group Executive Chairman Terrence Duffy told analysts on a quarterly conference call. "What they have said is that they are going to use other derivatives products such as futures and others to get the exposure to the market versus what they used to use in the cash market."

Duffy's comment came in response to a question from an analyst at Goldman Sachs Group Inc, which on Wednesday moved to defuse criticism of broker's trading in raw materials by throwing open its metal warehouse doors, offering to immediately swap aluminum for any end-users holding metal at its Metro International warehouses.

(Reporting by Ann Saphir; Editing by Gerald E. McCormick)



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